WASHINGTON -- Just about every policy lawmakers are considering for a deal to avert the so-called fiscal cliff would involve either raising individual income taxes, or cutting benefits in Medicare and Social Security. But there are a host of other avenues available for reducing the federal budget deficit that are rarely talked about, despite their mathematical merit.
There's an old axiom in the investment business that applies to the federal government, as well: You have to spend money to make money. Paradoxically, the U.S. fiscal position would likely be better off if the government simply spent more money. When the economy is booming, government spending can easily be wasteful.
But when the economy is not meeting its capacity, the government needs to step in to give it a boost, according to several schools of economic thought. At a time when there are more than four job applicants for every job opening, the economy is clearly not meeting the demand for work, and the government can productively step in by spending money to hire people and get things back on track. By boosting long-term economic growth through short-term spending, the government could actually ease the deficit by ponying up money right now.
makes sense maybe that is why congress is having such a hard time reconciling their agenda with reality, what was that statement "their arithmetic does not add up" it's a easy as 2+2 to most of us anyway.