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Old 09-06-2013, 01:06 PM   #2
Rohirrim's Avatar

Join Date: Jan 2003
Location: Twixt Hell & Highwater
Posts: 55,935

Malik Jackson

I still say that if you go with austerity you end any chance you had of paying down the debt. Austerity leads to fewer consumers having the ability to consume. In a consumer economy, that's suicide. I think Krugman is right. The government puts the liquidity back into a crap economy until people get back to work. Once the multi-trillion dollar economy is rolling again, you pay down the debt. Of course, this Keynesian formula was devised under the umbrella of a progressive taxation system. When you have capital gains taxed at a third of workers' income, will it still work? I don't know.
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