{"id":218508,"date":"2010-01-22T14:10:22","date_gmt":"2010-01-22T19:10:22","guid":{"rendered":"http:\/\/blogs.reuters.com\/james-pethokoukis\/?p=3244"},"modified":"2010-01-22T14:10:22","modified_gmt":"2010-01-22T19:10:22","slug":"america%e2%80%99s-challenge","status":"publish","type":"post","link":"https:\/\/mereja.media\/index\/218508","title":{"rendered":"America\u2019s challenge"},"content":{"rendered":"<p>From the great <a href=\"http:\/\/www.atimes.com\/atimes\/Global_Economy\/LA20Dj02.html\">David Goldman<\/a>:<\/p>\n<blockquote>\n<p>When Reagan took office in 1981, the baby boomers were in their 20s and 30s,  \t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\tAmerica had a 10% savings rate, the current account was in surplus, and America  \t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\twas the world&#8217;s largest net creditor nation. Reagan was able to cut <span id=\"IL_AD3\">taxes<\/span> and  \t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\tfinance an enormous budget deficit because the world&#8217;s demand for US Treasury  \t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\tsecurities was correspondingly large. In 2010, the baby boomers are in their  \t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t50s and 60s, America has saved nothing for a decade, the current account  \t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\tremains in severe deficit and the world is choking on the existing supply of  \t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\tTreasury securities. Cutting taxes to stimulate the economy is not as simple  \t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\tthis time round.<\/p>\n<p>Professor Reuven Brenner and I argued in the December 2009 issue of First  \t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\tThings that fundamental changes in American economic policy are required to  \t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\temerge from the Great Recession. We proposed that the United States fix the  \t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\tdollar to the Chinese yuan and other currencies in order to re-orient trade  \t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\tflows to the developing world. We added, &#8220;We have been borrowing in order to  \t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\tconsume; we need now to save in order to <span id=\"IL_AD5\">invest<\/span>. We need to shift the tax  \t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\tburden, <span id=\"IL_AD7\">moving<\/span> it away from savings and investment and toward consumption. We  \t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\tshould replace individual and corporate income taxes with consumption-based  \t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\ttaxes.&#8221;<\/p>\n<\/blockquote>\n","protected":false},"excerpt":{"rendered":"<p>From the great David Goldman: When Reagan took office in 1981, the baby boomers were in their 20s and 30s, America had a 10% savings rate, the current account was in surplus, and America was the world&#8217;s largest net creditor nation. Reagan was able to cut taxes and finance an enormous budget deficit because the [&hellip;]<\/p>\n","protected":false},"author":1063,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[],"class_list":["post-218508","post","type-post","status-publish","format-standard","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/218508","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/users\/1063"}],"replies":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/comments?post=218508"}],"version-history":[{"count":0,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/218508\/revisions"}],"wp:attachment":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/media?parent=218508"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/categories?post=218508"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/tags?post=218508"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}