Deficit – Healthcare Economist

What happens to the federal deficit when interest rates rise 1%

2022-02-22Jason ShafrinLeave a comment

Interest rates in the U.S.–as measured using the Fed Funds Rate–have been effectively 0% since the start of the pandemic. In fact, the last time the Fed Funds Rate was over 3% was way back in 2008. With year-over-year inflation in January 2022 hitting 7.5%, it is likely that interest rates will rise. Anyone cal…

Do we need less democracy?

2011-09-27Jason ShafrinLeave a comment

In The New Republic, Peter Orzag argues that to fix our budget mess, we need less democracy. Specifically, he argues that implementing the following four recommendations more consistently would improve the budget situation. Progressive tax code Permanently link taxes to the unemployment rate Backstop rules Independent institutions I have my doubts…

Much Ado about Nothing

2011-04-16Jason Shafrin1 Comment

The government will shut down…the government won’t shut down…Compromise! Finally, the Federal government has came to a compromise to reduce our swelling national debt. Or have they? The chart below shows that cutting the deficit has a lot about rhetoric and little about substance. Congress did save $78.5 billion in their latest agreement. Since the…

Japan: Bigger deficit problems than the U.S.

2010-11-22Jason ShafrinLeave a comment

The cover of The Economist this week looked at America’s budget deficit. According to their estimates, “America’s budget deficit in the fiscal year that ended on September 30th stood at $1.3 trillion; at 9% of GDP, the second-largest since the second world war.” The short run cause of this deficit is the recent severe recession,…

Half a billion: UC Budget Gap

2009-05-16Jason ShafrinLeave a comment

The state of California is in serious fiscal trouble. Those troubles extend the state’s flagship university system. “The scenario that assumes failure of the May 19 state ballot propositions would leave the UC system with a net budget reduction of $322 million, or 10 percent, in the 2009-10 year. Taken together with the state’s…