From The Economist: Running Hot

[Knee Deep in Water Chloe]

(I don’t know if you’ll be able to open this article. We subscribe to The Economist. )
The context of the article is that the global economy is volatile and a primary
Catalyst is the US tax cuts.

This paragraph is from the article:
This tension is an inevitable part of the return of monetary policy to more normal conditions. What is not inevitable is the scale of America’s impending fiscal bet. Economists reckon that Mr Trump’s tax reform, which lowers bills for firms and wealthy Americans—and to a lesser extent for ordinary workers—will jolt consumption and investment to boost growth by around 0.3% this year. And Congress is about to boost government spending, if a budget deal announced this week holds up. Democrats are to get more funds for child care and other goodies; hawks in both parties have won more money for the defence budget. Mr Trump, meanwhile, still wants his border wall and an infrastructure plan. The mood of fiscal insouciance in Washington, DC, is troubling. Add the extra spending to rising pension and health-care costs, and America is set to run deficits above 5% of GDP for the foreseeable future. Excluding the deep recessions of the early 1980s and 2008, the United States is being more profligate than at any time since 1945.




The Economist | Running hot www.economist.com/news/leaders/21736513-fiscal-policy-adding-demand-even-economy-running-hot-americas-extraordinary?frsc=dg%7Ce


If they’re nervous, it’s hard for me to not be nervous.

[tallguy]

To be clear, this newspaper would not advise a fiscal stimulus of the scale that America is undertaking. It is poorly designed and recklessly large. It will add to financial-market volatility. But now that this experiment is under way, it is even more important that the Fed does not lose its head.

It is the economic illiteracy of the GOP and their ever-present focus on tax cuts being the cure to every ill.  I've said here before that there was a better economic case to be made for tax increases now rather than cuts, and I stand by it.