This is a syndicated repost courtesy of Confounded Interest. To view original, click here. Reposted with permission.
There is little doubt that the Federal government loves to spend money, usually more than it takes in as taxes. The difference in the Federal budget deficit. The deficit has gotten so large that some are calling for a Constitutional Convention to proposed a balanced budget amendment to the US Constitution. But has deficit spending done any good and generated wage growth in the US?
The Federal government often runs in a deficit mode, except for the 1998-2001 period as a result of the The Balanced Budget Act of 1997, (Pub. L. 105 – 33, 111 Stat. 251, enacted August 5,1997). It was passed under Speaker Newt Gringrich (R-Ga) leadership. Unfortunately, two recessions (March-November 2001 and December 2007-March 2009) later and the US is in its worst budget deficit position since 1929.
This post was published at Wall Street Examiner on January 30, 2017.