Spending His Way to Austerity
· Too bad it won’t fly. It’s a truism that budget cuts alone will not guarantee faster economic growth, but at the current moment they will get us closer to it. With spending at 24% and debt held by the public at 70% of GDP—both modern records—the U.S. needs drastic spending cuts to head off a downward future spiral of tax increases and unaffordable interest payments. As Milton Friedman taught, spending is the real measure of government’s burden on the private economy, and reducing it leaves more resources for private actors to spend and invest.