After the Flimflam – New York Times 03-14-13

Salient to Investors:

Paul Krugman writes:

  • Paul Ryan’s proposal of slashing the top tax rate from 39.6 percent to 25 percent, yet somehow raising 19.1 percent of G.D.P. in revenues are even more fraudulent than his proposals in 2010 and fortunately this time getting the derision it deserves.
  • Draconian austerity is simply not needed given ultra low borrowing costs and relatively benign medium-term fiscal projections. Large short-run spending cuts would hobble our recovery at a time when unemployment is still disastrously high. The fantasy expansionary austerity economics of slashing spending in a depressed economy is a total failure in Europe and only deepens the depression.
  • The “Back to Work” proposal from the Congressional Progressive Caucus of substantial new spending offset by major deficit reduction later in the next decade largely through higher taxes on the wealthy, corporations and pollution rests on solid macroeconomic analysis.
  • We won’t get a Grand Bargain any time soon, but little by little, Washington’s fog of fiscal flimflam is lifting.

Read the full article at http://www.nytimes.com/2013/03/15/opinion/krugman-after-the-flimflam.html?nl=todaysheadlines&emc=edit_th_20130315&_r=0

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