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January 28, 2003

SOTU- Gutting the Economy

Here is the idiocy of the night:

"I will send you a budget that will increase discretionary spending by only 4% next year, about as much as the average family's income is expected to grow. And that is a good benchmark for us, since federal spending should not rise any faster than the paychecks of the American families."
Aside from the stupidity and heartlessness of cutting spending in a recession, when the need for government help expands precisely because family incomes are dropping, the basic statement is economically illiterate.

IF the population stayed the same year to year, benchmarking government spending to family income might make sense. But if the population is expanding, the demand for services, the number of children in schools, the number of police needed, and so on-- will automatically expand even if income stays the same. And with more people working (okay, well not under Bush, but under any competent President), tax revenue should automatically increase with a greater population.

Just to deliver the same service on a per capita basis, government spending has to increase at the same rate of inflation PLUS growth in the population.

Anything else is a cut in services.

Which is what Bush is proposing in the middle of a recession.

This is the most anti-human, economically suicidal economics possible.

Posted by Nathan at January 28, 2003 09:25 PM

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