RE: Debt reduction also creates fiscal space

[sawicky@xxxxxxxxxx (Max Sawicky)]

For any given level of fiscal space now,
we must have foregone some level in the past. So
there is no 'more' or 'less.'  There is only when.
A given renunciation of fiscal space today has
less ramifications (in terms of interest/GDP) in
the future than in the present.

mbs



All Summers is saying is that for a *given* level
of government outlays we can have more
government services if interest payments are
smaller. The `fiscal space' is within the *given*
level of expenditure.
Alan Isaac



HenryC.K.Liu wrote:

> Summers: "Debt reduction also creates fiscal space."
> Does PKT buy that as axiom?
>
> February 9, 2000
> LS-383
>
> TREASURY SECRETARY LAWRENCE H. SUMMERS TESTIMONY BEFORE THE HOUSE
> COMMITTEE ON WAYS & MEANS
>
> Full testimony:
> http://www.ustreas.gov/press/releases/ps383.htm