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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsYellen says tax cuts are blowing up the budget
Last year's aggressive tax cuts are at the heart of a worsening budget situation that will see deficits surge in the years ahead, according to an op-ed by former Fed Chair Janet Yellen and others.
The essay, published in Sunday's Washington Post, rebuts a study from Stanford University's Hoover Institution that blamed entitlement spending for the nation's worsening financial picture. Economists expect the shortfall to surpass $1 trillion in 2019 and worsen.
However, Yellen and a team of other economists reject the notion that Social Security, Medicare, Medicaid and veterans' benefits are the prime culprit. Instead, they insist, the main problem is that Congress passed a tax cut bill at precisely the wrong time.
"As we focus on the long-run fiscal situation, our goal should be to put the debt on a declining path as a share of the economy. That will require running smaller deficits in strong economic periods such as the present to offset the larger deficits that are needed in recessions to restore demand and avoid deeper crises," the group wrote. "Last year's Tax Cuts and Jobs Act turned that economic logic on its head."
The other authors are Martin Neil Baily, Jason Furman, Alan B. Krueger and Laura D'Andrea Tyson all former chairs of the White House Council of Economic Advisors.
https://www.msn.com/en-us/money/markets/yellen-says-tax-cuts-are-blowing-up-the-budget/ar-AAvGcG4?li=BBnbfcN
democratisphere
(17,235 posts)was Kabuki Economics combined with fake math.
Skittles
(153,164 posts)now they will try to start whacking Social Security and Medicare
roamer65
(36,745 posts)They will have to mop up all this excess Treasury paper with QE operations.
Inflation is gonna be hell over the next 10 years.
rurallib
(62,416 posts)there - all fixed
(that's been the fucking plan all along!)