Krugman being optimistic

An Imaginary Budget and Debt Crisis - NYTimes.com

Paul Krugman argues that there is reason to be optimistic about America's long term debt position, and notes that budgetary changes would not need to be all that great to make it even better.

I get the feeling that a similar column could be written about Australia.   And the first two points would be -

1.  don't give up revenue that you don't need to (carbon prices and mining tax.)

2.  don't start spending money on one man's pet idea that hardly anyone actually supports.

I might also add (and the same in the US):  don't increase defence spending beyond your means.

As for Australian pessimists, I see that Garnaut has that title currently.   I don't really understand the proposal though - how does a dramatic increase in productivity really happen these days?   He does mention the Australian dollar needing to come down (and even Judith Sloan mentioned that in her eye rolling performance with Joe Stiglitz a couple of weeks ago.   As I complained some time ago - right wing debt obsessed economists complained bitterly about Labor government spending and wages during the Gillard reign but barely mentioned the high Australian dollar which soared during her Prime Ministership.  Now that it's a Coalition government, have they decided it's the right time to acknowledge the problem?)