Paul Krugman: Deficit Commission Report “Unserious”

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    I don’t always agree with Paul Krugman, but I certainly agree with this.

    OK, let’s say goodbye to the deficit commission. If you’re sincerely worried about the US fiscal future – and there’s good reason to be – you don’t propose a plan that involves large cuts in income taxes. Even if those cuts are offset by supposed elimination of tax breaks elsewhere, balancing the budget is hard enough without giving out a lot of goodies – goodies that fairly obviously, even without having the details, would go largely to the very affluent.

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    Update: It’s here. And it really is that bad. The idea that co-chairs of a commission whose charge is fiscal sustainability should take it upon themselves to (a) declare that federal revenue must not exceed 21 percent of GDP – that’s right, putting a cap on receipts and (b) call for reducing the top rate from 35 to 23 is just awesome.

    What a joke.

    • Teddy Goodson

      of the Deficit Commission was made to order to produce this sort of answers. The 21 percent of GDP figure harks back to the days of Senator Taft and the post-World War II times, when there really was a discussion about whether or not an economy could survive if total taxation exceeded 25 percent. It was a hold-over from the Republican angst about FDR’s deficit financing compounded by the seemingly huge amount of borrowing for World War II. Given all the hatred of the “investing class” for anything and everything from FDR and Keynes, and and those sainted bond-holders who fear, I say, fear inflation, this report is utterly predictable. I really think Obama planned it this way when he chose his appointments.