Marshall Auerback on the "Deficit Hysteria"

Marshall Auerback on BNN:

SqueezePlay : March 11, 2010 : Fighting Deficit Hysteria (click on picture for the video)

Marshall points us to Rajiv Sethi's comments:

A government can change expenditure policies and tax rates, but has no direct control over realized revenues and outlays. As a result, raising tax rates or trimming expenditures (such as unemployment benefits) in the face of severe deficiencies in aggregate demand can worsen rather than improve its balance sheet position.