"Gould 0738" wrote in message
...
Bush is predicting the deficit will be reduced in half by 2006...even
while
maintaining the current tax rates and spending habits. Let's see if he's
right. I, for one, believe he is.

We can't get well simply by reducing the rate at which we drop into the
hole.

Sure you can...if the ground beneath the hole is rising.


Reducing the budget deficit by half only means that our national debt
grows
more slowly than at present. Instead of going 2.64 billion into the hole
every
day, we only drop 1.32 and think that's wonderful?

It's not wonderful, but acceptable. The debt/GDP ratio is all that matters.
When you buy a house, car, boat, etc., the thing the lenders are most
interested in is your debt to income ratio. They use that to determine if
you'll be able to afford the debt. The debt/GDP ratio is the nations debt
to income ratio.



We must run a surplus, and use the surplus to retire the debt.

Why? 10's of millions of households in America operate just fine operating
with debt. Even financial planners will tell you it's ok (and sometimes
desirable) to acquire debt, particularly in the earlier years. As you get
closer to retirement, then you want to operate under a surplus and retire
the debt.

If you view our economy as a person's lifespan, each down/up cycle can
represent one person's life. When we're in a recession, that's the
equivalent of a young entrepreneur starting out in life. Tax receipts
(income) are low, spending is high, and the debt accumulates rapidly. The
early investments in capital spending begin to pay off, causing an increase
in revenues. Spending begins to slow (especially as a ratio of revenues),
and net receipts sky-rocket. Now there's a surplus. The surplus pays down
the debt until the next recession...and a new life-cycle begins.



Any other course
is voo doo economics.

No, it's good business sense.



If we run a surplus by cutting taxes $100 billion and then cutting
expenses by
$200 billion, then fine.

You don't cut taxes. You cut the tax rate. If there's an early decrease in
tax revenue, that's only because it takes a little time for GDP to increase
enough to offset the rate reduction.


You can have your precious tax cut, and we can insure
the long term economic stability of the nation at the same time. If we cut
taxes $100 billion and then increase govt spending by another $100
billion- we
need to clean house all over the hill and put some adults in office. WH
and
congress.

You don't need to cut the spending...just put a cap on the yearly
inflationary increases. The spending will "cut" itself (as a percentage of
GDP).