News for hackers. Stuff that matters.

A comment on Tax Cuts Don't Lead to Economic Growth, a New 65-Year Study Finds . Parent comment

Re:Tax Cuts Don't Lead to Economic Growth, a New 65-Year Stu... by seanmcdirmid on Tuesday September 18, 2012 @05:15AM (#4537102)
Inflation in moderation has its uses. It acts to cut debt and encourages people to spend money and stimulate the economy today, which is preferable sometimes over encouraging saving. Compared to inflation, deflation is quite evil: your debt load goes up, what you want will be cheaper tomorrow, your best option is to save. Look at Japan's lost decade to see what that would bring us.
[ Parent | on HN ]
Re:Tax Cuts Don't Lead to Economic Growth, a New 65-Year Stu... by fauigerzigerk on Tuesday September 18, 2012 @05:26AM (#4537128)
I totally agree with you on inflation.

I would just add that Japan's experience has some unique aspects that will hopefully make it easier for the U.S to avoid that kind of development (I'm more pessimistic about Europe in that regard).

Particularly, Japan has a shrinking population and the asset price bubble in the late 80s was a lot bigger than the real estate bubble in the U.S up to 2006.

[ Parent | on HN ]
Re:Tax Cuts Don't Lead to Economic Growth, a New 65-Year Stu... by seanmcdirmid on Tuesday September 18, 2012 @06:33AM (#4537303)
Our birth rate and relatively friendly immigration policies (compared to Japan at least) are an advantage here. We also have enough room to grow to 400 or 500 million in the next few decades, which would definitely solve any demographic problem if that growth came from births and young immigration.
[ Parent | on HN ]