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(an email exchange)
Not even close!
> On Mon, Aug 25, 2008 at 11:54 PM, Russell wrote:
> I found Fischer’s speech.
> ”No combination of tax hikes and spending cuts, though, will change the total
> burden borne by current and future generations. For the existing unfunded
> liabilities to be covered in the end, someone must pay $99.2 trillion more or
> receive $99.2 trillion less than they have been currently promised.
Why/how? Show me the debits and credits and how that changes real outcomes!
> This is a cold, hard fact.
Yes, he believes it.
> The decision we must make is whether to shoulder a substantial portion of that
> burden today or compel future generations to bear its full weight.”
Yes, produce goods and services and send them back in time to pay off the debt.
> ”We know from centuries of evidence in countless economies, from ancient
> Rome to today’s Zimbabwe, that running the printing press to pay off today’s
> bills leads to much worse problems later on. The inflation that results from the
> flood of money into the economy turns out to be far worse than the fiscal pain
> those countries hoped to avoid. ”
What is ‘the printing press’ as above? Deficit spending? So why was the Fed pushing the latest fiscal package? Is this an attack on Bernanke?
> ”Right now, weÃƒÂ¢Ã¢â€šÂ¬Ã¢â‚¬Âyou and IÃƒÂ¢Ã¢â€šÂ¬Ã¢â‚¬Âare launching fiscal bombs against ourselves. ”
Then why is the Fed forecasting lower inflation over the next two years and beyond?