The dilemma we are trying to address is poverty. I still don't see how increasing education really addresses the problem. It would make the job market more competitive, but that just reduces the salary demand and the people are still fighting for the job. Increasing education and having a non-growing economy is like having 10 people instead of 5 people competing to get a slice of pie. No matter how many people are competing, the pie is still the same size. If we need to address this poverty issues, we need to bake more pies. Hmmm... it's about time to get some lunch now huh?
Your premise was wrong, that the size of the pie is the same. Again, with the China example. 80% of adults are illiterate before 1949, things have been changed dramatically. A lot more educated work force are added, and yet the unemployment rate isn't growing proportionally with the education rate, which means the pie size isn't stable. It should be pretty obvious, that as the society advances, less and less farmers are needed, and more and more relatively educated work force are required for industrized society. Better public education can increase the size of that pie, because nowadays, products are no longer just consummed in your own villiage, but rather shipped to the whole world.
A record low in GDP growth? Huh? We had a recession that lasted exactly 6 months as far as GDP is concerned. It was one of the mildest recessions in history. And if there had been deficit spending as we saw before and after, your tax rate today would be higher to fund the same level of government services. Deficit spending slows down economic growth for the endless future. If we hadn't accumulated all the debt of the last 25 years, our economy would certainly be smaller. However, the prospects going forward would look better - we could have a tax cut more than twice the size that Bush proposed without cutting a single government service. Not saying that is the ideal, but this reckless deficit spending is in no way beneficial for the economy in the long-term - especially when its not being spent on investments in infrastructure or education or something else that actually provides a return on investment.
I have to disagree on this. I think China's growth is directly attributed to internal financing in the private sector and allowing outside investors to invest on the economy. In order for companies to invest on employees and add jobs, it needs to either have capital or at least future prospects of capital.
Sorry... "record low" was an exaggeration, but we did see a huge drop of GDP growth at the aftermath of the Clinton administration. I also agree that there must be some sort of control for deficit spending. However, as long as the GDP/debt ratio is growing, the economy is pretty healthy. In fact, the country would be collecting more taxes in the long term if the tax rates are dropped as long as the government is putting the private sector in a favorable position.
On the GDP growth - I don't see how that's correlated to Clinton's deficit spending. After Reagan and Bush Sr.'s deficit spending, we had an even bigger recession. The recession was inevitable no matter what. In regards to the 2nd half - I agree. As long as GDP/Debt is increasing, we're in good shape. Unfortunately, that's not the case right now. We're accumulating debt faster than the GDP is growing, meaning more and more of every tax dollar is being put into paying interest on the debt.
The 1982 recession was shocking because they went from a 12.2% GDP growth to a 4.0% GDP growth. In 2001 and 2002, we had a growth of 3.2% and 3.4 respectively. Therefore, it was an even smaller growth and for a longer duration. Also, the GDP/Debt ratio is pretty stable right now judging by the last Fiscal Year report during Mid-Session Review (the debt/GDP analysis is on the last page of the document). I think we can agree that the government should take measures in making those numbers better, but we believe in different methods.
