James K. Galbraith wrote, In Defense of Deficits, that there is too much overreaction to the deficit the U.S. Government is running up. To his defense, Galbraith makes some very good points, some I wonder if even foreigners have thought of (or maybe they have). In many regards, I agree with Galbraith that the hyper-concern regarding deficits might actually be harmful. The government certainly can’t eliminate all the deficit immediately (which some are crying out for), as that would truly be catastrophic economically.
However, what Galbraith didn’t address, nor was it part of his article is what got us into these huge deficits. His arguments are pragmatic to some degree, but his arguments really turn into what ever the government wants, it gets. I do have a problem with that.
h/t: Tim O’Reilly