Monday, September 19, 2011

The President's New Plan

The good news is that he didn't insist on broadcasting a campaign speech in front of Congress, again. The bad news is that the President still doesn't seem to know much economics. Either that or he is becoming increasingly unserious.  His latest deficit reduction plan is touted as balanced between taxes and spending cuts. One problem is that a good chunk of the spending cuts are phony: He's counting the wind down of two wars as new cuts (although the Republicans have apparently agreed to count this as a cut for the deficit supercommittee). The proposed tax increases are just bad ideas.

It's also good news that the plan is not really intended to be acted on. It's just a campaign document that will be met with a resounding silence, even in the Democratically controlled Senate, much like his Stimulus II spend and tax plan.  Here's Greg Mankiw's take.