Good News on the Deficit

by Rocket Finance

I seem to be posting about politics a great deal these days, but this really is a personal finance blog. I will stay on topic after this. I promise. . .

Anyway, I was happy to read that the USA deficit as percentage of the GDP is down to 1.2% – half of the average deficit. Furthermore, tax receipts are the highest they have been in over four decades! Now I’m not happy that Uncle Sam is taking more of our money, but I am happy about the way that this has been accomplished: the tax cut legistlation of 2003.

I believe that those tax cuts are continuing to grow our economy – in spite of a recession in 2000-01, the September 11th attacks, an ongoing war, the Katrina disaster, skyrocketing oil prices, and a general lack of fiscal responsibility on the part of both congress and Bush. How many administrations have had to deal with anywhere near that many potential economic disasters?

Yet our economy is strong. Unemployment is posting all-time lows, the stock market is chugging along and now the deficit is going down. Makes me wonder what the economic health of our nations would be if we were given tax cuts and spending cuts.

I’m sure that a pay raise combined with budget cuts would get my family out of debt pretty quickly – could that strategy work at the federal level? We’ll probably never find out.

Three percent cash back on purchases made with the Chase Freedom Card is helping our budget. Maybe it can help yours!

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