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alstry (35.21)

Each $1 In Deficit Adds $4-$7 Of GDP

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February 17, 2011 – Comments (2)

In our highly leveraged domestic consumer economy, every dollar of government deficit spend adds between $4 and $7 of GDP....

Thus, our $1.5 Trillion dollar deficit adds between $6 Trillion and $10.5 Trillion of GDP...not including state and local deficits.

So next time someone tells you our defict TOTALS only about 1X GDP.....You may want to tell them that our CURRENT deficit in our consumer economy is most of the GDP.

Think about that as we want to cut our defict...cut our pay to teachers....cut our entitlements.....cut pay to cops and firefighters.....cut pay to healthcare.......cut our leveraged GDP

For every dollar we cut in deficit......we cut GDP by 4-7X in a deficit driven economy.

...and now you understand why we are all going to the www.udderworld.com and why soon everyone will be protesting, fighting a war, or restructuring into the Digital Age.

2 Comments – Post Your Own

#1) On February 17, 2011 at 11:23 PM, alstry (35.21) wrote:

Medicare Fraud adds billions to the GDP as well

So as we clamp down on fraud, expect the GDP to decline as well

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#2) On February 23, 2011 at 9:51 PM, rpgizzle (58.20) wrote:

Running a small deficit is good, but at this point the negatives far outweigh the benefits.  Deficit spending only goes as far as the opinions of the countries willing to finance your debt....

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