Comments on: A State of Fiscal Irresponsibility: Increasing Signs of an Emerging Economic Crisis http://mahoshada.com/2006/07/a-state-of-fiscal-irresponsibility-increasing-signs-of-an-emerging-economic-crisis/ Commentaries on Development and Economics Sat, 05 Jul 2008 15:26:09 +0000 http://wordpress.org/?v=1.5.2 Comment on A State of Fiscal Irresponsibility: Increasing Signs of an Emerging Economic Crisis by: sittingnut http://mahoshada.com/2006/07/a-state-of-fiscal-irresponsibility-increasing-signs-of-an-emerging-economic-crisis/#comment-481 Sun, 23 Jul 2006 18:53:59 +0000 http://mahoshada.com/2006/07/a-state-of-fiscal-irresponsibility-increasing-signs-of-an-emerging-economic-crisis/#comment-481 i agree with most of your analysis that government is fiscally irresponsible. i also agree that government 'obfuscate and spin the economic information'. however when we bring out the statistics to support our arguments we should make sure we do not 'spin' them erroneously ourselves. in your post your compare the nominal value of first four months' budget deficit with last years first four months and gets a 31% increase. then you add 31% to last year's whole year budget deficit expressed in gdp percentage terms( not in nominal money value ) and speculate that this year will be 11.4%. this is wrong maths. you ignore the fact that real gdp in last year and this year will be different. what you should do is find the difference between this and last year's first four months budget deficit in gdp percentage terms and then use that (instead of nominal money value ) to speculate about this years full year deficit . same way you say 2005 public debt is estimated to be equal to about 94 percent of gdp. you do not give the figure for 2004. is it because that percentage has been coming down? as i said i agree that budget deficit and public debt are irresponsibly high, but let us argue for responsibility with correct statistics. they are damming as they are . i agree with most of your analysis that government is fiscally irresponsible. i also agree that government ‘obfuscate and spin the economic information’.

however when we bring out the statistics to support our arguments we should make sure we do not ’spin’ them erroneously ourselves. in your post your compare the nominal value of first four months’ budget deficit with last years first four months and gets a 31% increase. then you add 31% to last year’s whole year budget deficit expressed in gdp percentage terms( not in nominal money value ) and speculate that this year will be 11.4%. this is wrong maths. you ignore the fact that real gdp in last year and this year will be different. what you should do is find the difference between this and last year’s first four months budget deficit in gdp percentage terms and then use that (instead of nominal money value ) to speculate about this years full year deficit .

same way you say 2005 public debt is estimated to be equal to about 94 percent of gdp. you do not give the figure for 2004. is it because that percentage has been coming down?

as i said i agree that budget deficit and public debt are irresponsibly high, but let us argue for responsibility with correct statistics. they are damming as they are .

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