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Taylor's Budget Two-Step
futureofcapitalism.com

Stanford economist John B. Taylor, writing at Bloomberg:

A good two-step approach would be to agree now to $2.5 trillion in spending-growth reductions and to raise the debt ceiling. Then have an open debate about how to close the remaining $3.5 trillion gap next year, during the 2012 election campaign.

Democrats might propose to close the shortfall with $2 trillion in revenue increases and $1.5 trillion in spending reductions; Obama could make that explicit in his budget submission in February 2012. The Republicans could propose to close the whole gap with spending reductions; indeed all the Republican candidates for president have proposed this already.

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Taylor's Budget Two-Step
futureofcapitalism.com

Stanford economist John B. Taylor, writing at Bloomberg:

A good two-step approach would be to agree now to $2.5 trillion in spending-growth reductions and to raise the debt ceiling. Then have an open debate about how to close the remaining $3.5 trillion gap next year, during the 2012 election campaign.

Democrats might propose to close the shortfall with $2 trillion in revenue increases and $1.5 trillion in spending reductions; Obama could make that explicit in his budget submission in February 2012. The Republicans could propose to close the whole gap with spending reductions; indeed all the Republican candidates for president have proposed this already.

Read More...


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John B. Taylor

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