David Stockman: Why Deficits Do Matter, Three Areas of Why the Deficit has Skyrocketed

From Mike Church's Church Doctrine:

Hell Boy II - The Golden Constant ©2011 Mike Church Hi folks it’s Mike Church with today’s Church Doctrine. On Saturday I had the enormous privilege of being in a small group of folks at the Ludwig von Mises Institute in Auburn AL who listened to former Reagan Budget Director David Stockman speak. What Stockman said however should not be limited to the audience he delivered it to. Every citizen of the United States needs to hear the real story of our post gold-standard economy. To summarize his speech titled “Why Deficits Do Matter” is to run the risk that you won’t seek it out in its entirety-I am willing to accept that risk. Stockman delivered his laser guided Austrian Economics missiles at 3 areas: Our debt and deficits, the value or non-value of our currency and the state of the American people’s balance sheets. None of these are works of art you would hang in your home or even in your garage but the most repulsive of the three is the latter. Stockman explained that since the the 1870’s Americans held our debt, public and private to around 1.6 times that of GDP, this he termed “The Golden Constant” and it was remarkably stable until 1971, the year Richard Nixon elected to take us off the gold standard entirely. This move was supposed to liberate us from the shackles gold placed on currency and usher in the greatest prosperity… EVER. Instead we have increased the Golden Constant TWICE to 3.6 times GDP.