From: mykes@shell.portal.com (mike myke schwartz)
Subject: Re: Conservative Values (Re: New group proposal:  alt.conservative.forum)
Followup-To: alt.fan.rush-limbaugh,talk.politics.misc
Organization: Portal Communications Company
X-Newsreader: TIN [version 1.1 PL7]
Date: Tue, 5 Jan 1993 04:41:01 GMT

Russ Anderson (rja@mahogany126.cray.com) wrote:
: 
: In <C02Mws.CtK@unix.portal.com>, mykes@shell.portal.com (mike myke schwartz) writes:
: > Mike Jones (mjones@fenway.aix.kingston.ibm.com) wrote:
: > : mykes@shell.portal.com (mike myke schwartz) writes:
: 
: > : :                                        The most successful governmental
: > : : economic policies in this century, known as trickle-down, were a Kemp/Reagan
: > : : implementation.  Reagan's terms not only produced enormous prosperity and
: > : : growth, but year after year the debt and defecit as a percentage of
: > : : GDP _decreased_ (source: Milton Friedman, interviewd on Wall Street Week).
: > :
: > : This claim is so vague as to be meaningless. It is true that you can pick
: > : starting and ending points to illustrate this fact, but there's no independent
: > : reason to pick those points. If you take "the 80's" (1980-1989), or "the
: > : Reagan years (1980-1988), that isn't a true statement. (I'll welcome FACTS
: > : to prove me wrong, because I don't have the numbers handy.) The growth was
: > : largely fueled by massive increases in public and private debt, which has
: > : been very much responsible for the mess we're in now.
: >
: > I did not video tape Wall Street Week, nor do I have a transcript of it.
: > The best of my recollection is what I wrote.  I apologize for saying that
: > the DEBT decreased.  But the defecit did indeed decrease.  Since you ask
: > me to do your research for you, I will provide you with the data, as found
: > in my 1992 Universal Almanac.  All dollar figures are in BILLIONS.
: >
: > 1980 GNP 2732.0, defecit = 73.8, %GNP = .0270
: > 1985 GNP 4014.9, defecit = 212.3, %GNP = .0529
: > 1987 GNP 4536.7, defecit = 148.0, %GNP = .0327
: > 1988 GNP 4864.3, defecit = 155.1, %GNP = .0319
: > 1989 GNP 5200.8, defecit = 152.0, %GNP = .0292
: 
: Mike, unless you plan on arguing that .0270 > .0292, you just disproved your
: own assertion.
: 
: The deficit as a percentage of GNP was higher at the end of the 1980's than
: it was at the start of the 1980's.
: 

Russ, the assertion was made that the defecit DID not decrease at all,
as %GNP, and someone questioned Milton Friedman's claim that it did.  It did.
In fact, the consistent yearly decrease from 85-89 was deliberate and
healthy.

The assertion that defecit spending is the cause of any problems is false.
Tell that to people who buy homes with mortgages of (at least) 4x their
gross earnings.  The assertion that defecit spending every year is bad is
also false.  If, yearly, you get a $100/month pay raise ($1200/year), you
do indeed have the ability to pay $100/month on new debt costs.

If the current debt is (rougly) $4 Trillion and federal revenues are $1.2
Trillion, then the debt is not the problem.  If you look at the debt in
relationship to the GNP as a whole, the nation is incredabily healthy.

I'm sure we would al be saying "borrow more!" if the govt. invests
the money in things that give back a good yield.  For 3/4 of the debt,
we could have set up an annuity to fund the defense budget (or half the
entitlement budget) for perpetuity and paid for it for 30 years.

The bottom line is that govt. won't stop defecit spending.  There is no
compelling reason to.  By the time the GNP triples, the debt will too.
The only negative we will feel is during recessions, which will hurt the
govt's ability to pay for everything.

A trend as shown by the above debt vs. GNP figures illustrates how strong our
economy was/is and if continued, the debt would disappear in 40-50 years.
The debt starts disappearing the day defecit spending stops...


: -- 
: Russ Anderson    |  Disclaimer: Any statements are my own and do not reflect
: ------------------              upon my employer or anyone else.  (c) 1992
: EX-Twins' Jack Morris, 10 innings pitched, 0 runs (World Series MVP!)
Newsgroups: alt.fan.rush-limbaugh,alt.fan.limbaugh