Quote:
Originally posted by sgtclub
Why hasn't anyone mentioned that Rubin's theory (i.e., that there is a connection between high deficits and high interest rates) has been proven incorrect?
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This was not Rubins theory, but the conventional wisdom of the bond markets. The bond markets definitely don't think this has been proven incorrect. I don't buy the Republican propaganda about Rubin. Without him things would have really gotten out of hand from 92-94. In addition, if the Republicans had not come to power in 1994 he would have been the person holding us back from disaster.
In addition, he argued that the Republican spending cuts were not necessary because economic growth would pull us out of the deficits sooner than people thought. He was right. I think the spending cuts would have been a good thing, but the guys knew his stuff.
