Everything you thought you knew about budget deficits is wrong

Justin Sullivan/Getty Images Politicians pay such frantic lip service to "America'sdebt" that it’s become common knowledge that rising budget deficits can put the economy at imminent risk. Except, in this case, the conventional wisdom is dead wrong, according to a new paper presented at the Federal Reserve Bank of Kansas City’s annual Jackson Hole symposium. "Even in countries with high public debt, the penalty for activist discretionary fiscal policy appears to be small," wrote Alan J. Auer...