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Who Remembers Guns and Butter?

February 17, 2009
Paul Craig Roberts
2/16/2009

President Lyndon B. Johnson’s policy of Great Society spending and Vietnam War is credited with the rising American inflation that persisted until checked by President Reagan’s supply-side policy.

In Johnson’s time the American economy and the US dollar were strong, and there was no current account deficit. Yet, LBJ’s policy of guns and butter did long-term harm.

The Bush/Obama 21st century policy of guns and butter makes LBJ look like a piker. The 2009 and 2010 federal budget deficits will be monstrous even without guns. But Obama is exiting (apparently) the Iraq War in order to start two, possibly three, more wars.

The story continues …..

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