Intellectual Garbage Cleanup: Walter Williams Edition
Uncertainty and Aggregate Demand

Department of "Huh?!" (Clive Crook Edition)

Why oh why can't we have a better press corps?

Clive Crook:

Clive Crook - How Obama should curb the deficit: As for the [Simpson-Bowles] plan, it is good.... One can quarrel with many items... and not just over details. The overall fiscal adjustment may be too mild. It takes decades to balance the budget (though public debt starts to decline more promptly). Also, the chairmen adopt the goal of holding revenues at no more than 21 per cent of gross domestic product indefinitely, without saying why. That number is questionable; so is the intention to hold it constant. Ageing of the population, by itself, will tend to push the revenue requirement higher...

One does wonder how Clive Crook thinks public debt can decline before the budget is balanced. If the budget is balanced, the public debt is constant. That is what it means to balance the budget: you don't have to sell extra bonds to raise the public debt.

Either he is using the wrong concept of "public debt," or he is using the wrong concept of "budget balance"--or both.

More important, perhaps, is that Crook says that the plan is both not bold enough and too draconian: the "fiscal adjustment may be too mild" but also "holding revenues at no more than 21 per cent o gross domestic product... is questionable.... Ageing... by itself... push[es] the revenue requirement higher..."

It's really not good when you find yourself saying that the meal is both too spicy and too bland.