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The Bush administration's policy of sharply cutting taxes while increasing government spending is both misguided and harmful. Presumably rationalized in private as a way of shrinking government over the long term without paying a current political price, this policy in fact increases the government's distributional intervention by handing money to current voters at the expense of younger and future generations. Moreover, the ballooning fiscal gap may lead to an Argentina-style meltdown in the U.S. government's position as a borrower in world capital markets, potentially yielding chronic inflation, unemployment, and bank and currency crises that may affect our economic productivity for an indefinite period.