The case for higher taxes

A chart making its way around the internet likens the national budget to household finances, but its delivery of the message is imperfect. David Graham provides a word of caution:

The problem with a chart like this is that the easy retort is: Well, OK, why don't you just cut household expenses by $16,500? In a household, the family would have to cut expenses to whatever the could pay (or, realistically, cut down other spending on eating out, travel, and so on) to make up the gap, or else risk bankruptcy and homelessness. For governments, unlike households, it's generally OK -- and sometimes beneficial -- to take on debt, for the same reasons that corporations often take on debt. That's perhaps particularly true at a time of super low interest rates. The debate among economists on the left and right isn't really over whether it's OK for the government to owe money, but about what level of debt is healthy.