Re: “Raising debt ceiling just the first step on road to fiscal health” (Viewpoint, 7-28).
As is typical for him, Rep. Adam Smith mixed both Republican and Democratic talking points in his near-constant aim to appear centrist. Unfortunately, many of those right-wing points are plainly absurd.
You cannot find an economist not funded by the Heritage Foundation who will state, as he did, “that getting our deficit under control is critical . . . to helping our economy right now.”
The problem facing our economy right now is demand. Consumer spending accounts for 70 percent of our economy, and large corporations are sitting on nearly $2 trillion. They’re not sitting on that money because of policy “uncertainty,” as Smith put, but because the poor and middle class can’t afford their widgets. They are the real “job creators,” not Wall Street investors.
Smith seems to believe in the “confidence fairy.” If that were to exist, federal bond rates wouldn’t be under 3 percent. He also seems to believe in contractionary expansion. Contractionary economic policies always lead to contraction. To believe otherwise is to believe in fairy tales.