Budget Deficits

For one, I’m not too overly concern about United States Governments running a Budget Deficit. However, there are limits!

I’m not sure if 5% of GDP is a magic number, but that does start to seem like quite a bit. I would say this is especially so when for all practical purposes, the economy is doing fine.

If the US Economy was in recession, or worse, deficits of that scale would likely be reasonable. But, when we have been in a steady recovery for 10 years, running a growing budget deficits seem like the wrong tactic.

Anyway, this chart from today’s Wall Street Journal provides some historical perspective.


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