Interesting enough, these facts on unemployment contrast with something else that has recently happened.
Spending exceeded receipts by $680.3 billion in the 12 months ended Sept. 30, the narrowest gap since 2008, compared with a $1.09 trillion shortfall in fiscal 2012, the Treasury Department said today in Washington. In September, the U.S. recorded a $75.1 billion surplus, little changed from the surplus in the same month a year earlier.
http://www.bloomberg.com/news/2013-10-30/budget-deficit-in-u-s-narrows-to-5-year-low-on-record-revenue.html
So, the deficit is low(er). But is this a good thing? I would certainly say no. But I'll be interested to hear opposing arguments. But let me first present my case with the help of some of my favorite economists.
First of all, it is important to remember that a government deficit means more money in our pockets. Or at the very least, a government deficit means more money in the private sector.
What the above means is this: government deficits create private sector wealth, while government surpluses drain it. There is no trickery here. When the federal government spends in deficit, it does so by putting financial assets, usually in the form of Treasury bills, in the hands of the public; when it spends in surplus, the net quantity of Treasury bills held by the public declines.
http://www.forbes.com/sites/johntharvey/
In addition, empirical evidence and other countries have proven that a deficit can be a good thing.
They thought all kinds of bad things about the deficit. And then, after the 2011 debt ceiling debacle and the formal downgrading of the credit rating of the United States, they were all proven utterly wrong. Immediately after the U.S. was downgraded, interest rates unexpectedly went down! They did not go up as universally feared. The U.S. government was not cut off from spending; was not down on its knees before the IMF begging for funding; and it was not the next Greece.
And the likes of Alan Greenspan and Warren Buffet immediately explained exactly why -- we "print" our own money. Just like Japan and the UK, for example, who also never face funding issues no matter how large their deficits may be, we always have the ability to make any size payment in our own currency -- U.S. dollars. The U.S. government is not like the Greek government that is not the issuer of the euro, and is not like California that is not the issuer of the U.S. dollar. So we can't be the next Greece or the next California, because the U.S. government is never dependent on borrowing or taxing to be able to spend. As the issuer of the dollar, that notion is entirely inapplicable. Yes, too much net spending might cause inflation, but there is never a solvency risk for the issuer of a currency.
http://www.huffingtonpost.com/warren-mosler/fiscal-cliff-debt_b_2114140.html
But don't worry, I know what many of you will jump to - inflation! And you have a legitimate concern, inflation can indeed be a serious issue. That's why if inflation gets too high, we should start reducing spending. But right now, inflation is actually below its target. Compared to the rest of the world, our inflation levels are incredibly healthy. Just look at Europe, where low inflation is actually damaging the ability of private individuals to pay off debt.
But in any case, even if you disagree with everything I just said in the paragraph above, deficit spending likely won't increase inflation anyway.
This article explains why through simple algebra: http://www.forbes.com/sites/johntharvey/2011/05/14/money-growth-does-not-cause-inflation/
Fiscal responsibility is one of the most dangerous ideas in economic history. So let's increase the deficit. Let's reverse the effects of the sequester, let's give cash to state governments, and let's cut taxes - on corporations, on the middle class, and on any of the poor that pay taxes.
