On this point though he's right.
From Mr. Summers' website an opinion piece he wrote for the Financial Times:
The battle over the US budget is the wrong fight
A small rise in economic growth would entirely eliminate the projected long-term budget gapHT: Via Meadia who writes:
October 13, 2013
This month Washington is consumed by the impasse over reopening the government and raising the debt limit. It seems likely that this episode, like the 1995-96 government shutdowns and the 2011 debt limit scare, will be remembered mainly by the people directly involved. But there is a chance future historians will see today’s crisis as the turning point when American democracy was to shown to be dysfunctional – an example to be avoided rather than emulated.
The tragedy is compounded by the fact that most of the substance being debated in the current crisis is only tangentially relevant to the main challenges and opportunities facing the country. This is the case with respect to the endless discussions about the precise timing of continuing resolutions and debt limit extensions, and to the proposals to change congressional staff healthcare packages and cut a medical device tax that represents only about 0.015 per cent of gross domestic product.
More fundamental is this: budget deficits are now a second-order problem relative to more pressing issues facing the US economy. Projections that there is a major deficit problem are highly uncertain. And policies that indirectly address deficit issues by focusing on growth are sounder economically and more plausible politically than the long-term budget deals with which much of the policy community is obsessed.
The latest Congressional Budget Office projection is that the federal deficit will fall to 2 per cent of GDP by 2015 and that a decade from now the debt-to-GDP ratio will be below its current level of 75 per cent. While the CBO projects that under current law the debt-to-GDP ratio will rise over the longer term, the rise is not large relative to the scale of the US economy. It would be offset by an increase in revenues or a decrease in spending of 0.8 per cent of GDP for the next 25 years and 1.7 per cent of GDP for the next 75 years....MORE
...Another way of saying this is that changing technology is making it possible for the US long-term to combine generous social programs with low taxes and low debt, but that in order to gather in this bounty we need significant social reforms and many existing programs need to be changed....The Reformed Broker also had a link, I'm surprised there weren't more.
*How Larry Summers lost Harvard $1.8 billion
