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Paul Krugman: Clueless Washington Doesn't Know The Deficit Is 'Mostly Solved'
"Reasonable projections do not, repeat do not, show anything resembling the runaway deficit crisis that is a staple of almost everything you hear, including supposedly objective news reporting," the Nobel Prize-winning economist wrote in a blog post on Thursday. He cited a new graph from the Center on Budget and Policy Priorities showing that since early 2011, the government has largely stabilized the U.S. debt outlook.
The deficit has loomed large in political debates over the past few years. Major newspapers published far more articles about the deficit than about unemployment starting in late 2010, according to a 2011 analysis by National Journal. The debt ceiling fight amplified coverage of the national debt on major TV networks, according to a 2011 analysis by ThinkProgress. And CNBC recently launched a campaign called "Rise Above" to call for deficit reduction.
Politicians have shaped government policies in kind. The government has shed 651,000 employees since President Barack Obama took office, according to Bureau of Labor Statistics data. This austerity has made the unemployment rate higher than it would have been otherwise, according to some economists.
Obama seems to be gearing up for future budget battles. On Thursday, he nominated his Chief of Staff Jacob Lew, a budget expert, for Treasury secretary. Congressional Republicans have threatened to force the U.S. government to default by March if Obama does not agree to spending cuts.
As I've stated time and time again, debt is NOT BAD ,unless you cannot pay it back. The U.S. is one of the richest countries in the world and has no problem paying back debt...unless the U.S. Congress decides to default on our loans. That, my friends, is an unheard of scenario. The U.S. has always paid back it's debts and had a triple-A credit rating up until this congress screwed it up by being a 'slow pay' government. We paid, but not on time. We had the money, but screwed around and didn't sen in the payment.
Now the president has another disgruntled asinine congress to deal with who are creating a no-problem-but-let's-make-it-a-problem falderah. DON'T FALL FOR IT!