The Budget Deficit and Economic Growth
Financial pundits are ringing the bells signaling that an economic turnabout is underway. Of course many of these writers are associated with the now tainted mutual fund industry and one must consider the source. However, a number of others are also stating that the economy is in a turnaround situation. The question is: is it real, and for how long?

Those of us who are deficit hawks look to the federal surplus or deficit as key indicator of the future. Consider the following statements:

"It took Congress 101 years to spend its first $500 billion dollars. But it took just 10 years to spend the next $500 billion; and now just four years to spend the last $500 billion."

"Milton Friedman, the revered Nobel Prize-winning economist, declares this unbridled spending "is the single greatest deterrent to faster economic growth in the United States today."

Is the turnaround going to last past the next election?