>Nathan's point seems well taken. Given that we're living in a fool's
>paradise and there is no appreciable demand for spending on job creation
>and social services, what *is* the objection to paying off on the debt
>until the (ever nearing!) recession hits? Wouldn't this mitigate any
>adverse inflationary impact of deficit spending when the recession does
>occur?
1) The surpluses are coming from Social Security taxes, which are flat-to-regresive. The principal payments are going to rich folks. This is an upward transfer of income.
2) It cedes the ideological high ground to the austerity party. Fiscal politics is now reduced to Andrew Mellon vs. Jack Kemp. There's not even any room for Max Sawicky anymore!
3) Every other time the U.S. tried to pay off its debts, deflation and depression were the result. We'll see if it's different this time.
Doug