It basically implied that for a certain class of spending you have to match increases in future outlays with increases in future revenues. "Increase" in this sense does not mean nominal changes from year to year. It means legislation that increases spending more than it would otherwise increase.
Moreover, it does not apply to discretionary spending. Nor does it mandate reducing pre-existing debt.
That said, Montgomery is a deficit hysteric. In one sense, you can hardly blame her. She is just echoing what a lot of uninformed economists say.
-----Original Message----- From: lbo-talk-bounces at lbo-talk.org [mailto:lbo-talk-bounces at lbo-talk.org] On Behalf Of Politicus E. Sent: Saturday, April 25, 2009 10:53 PM To: lbo-talk at lbo-talk.org Subject: [lbo-talk] liberal austerity
Rhetoric or liberal austerity?
>From the Washington Post:
Obama Backs Pay-As-You-Go Law By Lori Montgomery
President Obama today threw his weight behind a new law to rein in federal spending, cheering fiscal hawks in the House who have been pressing for a vote on such a measure since Democrats claimed control of Congress in 2007.
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