Comments on: Taking Our Economy For Granted http://antti.vilpponen.net/2009/09/23/taking-our-economy-for-granted/ make meaning Sat, 13 Mar 2010 11:16:58 +0000 http://wordpress.org/?v=2.9.2 hourly 1 By: HE http://antti.vilpponen.net/2009/09/23/taking-our-economy-for-granted/comment-page-1/#comment-366533 HE Mon, 05 Oct 2009 21:51:55 +0000 http://antti.vilpponen.net/?p=1766#comment-366533 I think there's another way to look at this. The role of government is neither to balance the budget or create a surplus but to serve the needs of the population as best it can. To do that it has to weigh up several factors, one of which is what level of expenditure is necessary and prudent. The argument being made here is that because the government in general fails to balance the budget, it is acting irresponsibly or sub-optimally. That's not necessarily true. If the rate of general economic growth exceeds the growth in state debt, the debt to gdp ratio actually decreases. That doesn't make it good, but it does make it sustainable - and importantly, it means that our children will pay a smaller proportion of their income to service the debt than we do now. The debt to GDP ratio decreased in Finland in the decade up until the economic crisis. Now it's up to about 60%, which isn't great, but it's low by international standards. Cutting expenditure would be painful too, so that is the reality of the situation the government is in. I think there’s another way to look at this. The role of government is neither to balance the budget or create a surplus but to serve the needs of the population as best it can. To do that it has to weigh up several factors, one of which is what level of expenditure is necessary and prudent.

The argument being made here is that because the government in general fails to balance the budget, it is acting irresponsibly or sub-optimally. That’s not necessarily true. If the rate of general economic growth exceeds the growth in state debt, the debt to gdp ratio actually decreases. That doesn’t make it good, but it does make it sustainable – and importantly, it means that our children will pay a smaller proportion of their income to service the debt than we do now.

The debt to GDP ratio decreased in Finland in the decade up until the economic crisis. Now it’s up to about 60%, which isn’t great, but it’s low by international standards. Cutting expenditure would be painful too, so that is the reality of the situation the government is in.

]]> By: Jon Martin http://antti.vilpponen.net/2009/09/23/taking-our-economy-for-granted/comment-page-1/#comment-365589 Jon Martin Mon, 28 Sep 2009 05:18:41 +0000 http://antti.vilpponen.net/?p=1766#comment-365589 I think there's another way to look at this. The role of government is neither to balance the budget or create a surplus but to serve the needs of the population as best it can. To do that it has to weigh up several factors, one of which is what level of expenditure is necessary and prudent. The argument being made here is that because the government in general fails to balance the budget, it is acting irresponsibly or sub-optimally. That's not necessarily true. If the rate of general economic growth exceeds the growth in state debt, the debt to gdp ratio actually decreases. That doesn't make it good, but it does make it sustainable - and importantly, it means that our children will pay a smaller proportion of their income to service the debt than we do now. The debt to GDP ratio decreased in Finland in the decade up until the economic crisis. Now it's up to about 60%, which isn't great, but it's low by international standards. Cutting expenditure would be painful too, so that is the reality of the situation the government is in. I think there’s another way to look at this. The role of government is neither to balance the budget or create a surplus but to serve the needs of the population as best it can. To do that it has to weigh up several factors, one of which is what level of expenditure is necessary and prudent.

The argument being made here is that because the government in general fails to balance the budget, it is acting irresponsibly or sub-optimally. That’s not necessarily true. If the rate of general economic growth exceeds the growth in state debt, the debt to gdp ratio actually decreases. That doesn’t make it good, but it does make it sustainable – and importantly, it means that our children will pay a smaller proportion of their income to service the debt than we do now.

The debt to GDP ratio decreased in Finland in the decade up until the economic crisis. Now it’s up to about 60%, which isn’t great, but it’s low by international standards. Cutting expenditure would be painful too, so that is the reality of the situation the government is in.

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