Inflation is good!
Hadn’t you heard?

The “improving” budget numbers reflect higher inflation, not lower spending or more economic activity.

Max Sawicky looks at the numbers: the “improvement” in the budget deficit that Bush and Cheney have been bragging about (down to only the highest level ever in real dollars) isn’t due to a more optimistic growth forecast, but to a higher inflation estimate.

“Due to our wonderful policies, inflation is forcing taxpayers into higher brackets at a faster-than-expected pace, raising revenues. Hurrah for us!”

So it’s not just that the Bush Team sets low goals for itself and fails to meet them; it sets low goals for itself, fails to meet them, and lies about it.

As Disraeli said of Lord John Russell, learing that such creatures are called the leaders of a great nation is enough to make you believe that the Egyptians worshipped an insect.

Update: For those who insist on technical verbal precision, be aware that the tax “brackets” are indexed for inflation. What higher inflation actually does is push more people into Alternative Minimum Tax territory and into the territory where various tax credits phase out, subjecting them to higher effective marginal tax rates.

Author: Mark Kleiman

Professor of Public Policy at the NYU Marron Institute for Urban Management and editor of the Journal of Drug Policy Analysis. Teaches about the methods of policy analysis about drug abuse control and crime control policy, working out the implications of two principles: that swift and certain sanctions don't have to be severe to be effective, and that well-designed threats usually don't have to be carried out. Books: Drugs and Drug Policy: What Everyone Needs to Know (with Jonathan Caulkins and Angela Hawken) When Brute Force Fails: How to Have Less Crime and Less Punishment (Princeton, 2009; named one of the "books of the year" by The Economist Against Excess: Drug Policy for Results (Basic, 1993) Marijuana: Costs of Abuse, Costs of Control (Greenwood, 1989) UCLA Homepage Curriculum Vitae Contact: