The deadline to raise the federal debt ceiling came and went without anything happening.  Some say that this is proof that it was never a real issue to start with.  Is it possible that they are right?

Not a chance.  We got an extension until August by raiding the pension fund.

You may or may not be willing to take the risk, as some are, but it is unreasonable to think government default has anything other than horrible consequences – starting with a complete government shutdown, likely involving higher costs to service the massive debt we have, and probably threatening the fragile recovery we have in the economy.

Yet there are many who want a long-term budget balancing plan before they agree to increasing the debt limit.  It may surprise you to know that just such a plan has already been crafted by a bi-partisan commission, and it is a damned good one.

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When is unemployment more than just the lack of a job?  The term “Structural Unemployment” has started to gain prominence in the news for the first time since the 1980s, and it means a lot more than the lack of work.  It refers to a lack of appropriate skills among many of the labor pool that makes many people difficult or impossible to employ.  While this is a serious problem, it could actually be good news – there is a new economy rising out of the ashes of the old one.

The difference between good economic news and bad is, as always, written in our ability to deal with the situation at hand.

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There is little doubt that the economy is not healthy.  I have used the term “Managed Depression” to describe it, claiming that we are in a long-term slowdown that is more severe than most officials and prognosticators are willing to admit.  I glibly defined the term “Managed Depression” some time ago, but many people have asked me for a more rigorous one.  Here is the case stated as simply as possible.

What’s in a word?  Why is there value in calling this a “Managed Depression” or anything else using the dreaded “D Word”?  There are two reasons.  The first is that a sense of urgency has been missing as our politics and news analysis has been easily distracted by side issues that seem expedient. The second is that while a Depression is an unusual event historically, it’s not without parallel.  We’ve learned a lot along the way and know something about how to handle it.  But we won’t get past it until we’re honest and tackle it directly.

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