As Paul K writes this AM, it does seem to be the case that the debt crisis mongers are getting less love and attention these days. I was on TV the other day with a Republican congressman and when he launched into his talking points on the crushing Greco-style crisis we face, his words just seemed to land with a thud.
Paul ticks off a number of good reasons as to why we may be—and that’s “may,” not “are”—turning a corner on this, but I’d add a few more.
First, while I quiver to think that perhaps facts may matter once again, the facts are that we’re a good portion of the way to the first goal of actual fiscal rectitude: get the debt growing less quickly than the GDP. The quite excellent set of tables here from Sen Patty Murray’s budget document presents the facts with great clarity. There’s been $2.4 trillion of deficit savings over ten years so far (table 2), and according to our chief hair-on-fire extinguisher at CBPP, Richard Kogan, it will take another $1.4 trillion—about 0.6% of GDP over the next decade—to stabilize the debt as a share of GDP.
[An aside: the Murray budget memo was the best piece of budget analysis I’ve seen coming out of the Congress in years. Like I said, it gives one hope that factual analysis may one day rise again in that benighted institution. It also leads me to be quite hopeful that the Senate’s budget will be an important and venerable counterbalance to the Ryan-type slash and burn budgets we’ve seen from the House side.]
I should also note that Richard’s piece on that $1.4t has been #1 for downloads from our site for a while now. So I submit that another factor in play here is…wait for it…the factual reality that there is no budget crisis.
To be clear, that doesn’t mean getting from here to stabilization will be a cakewalk. Fiscal politics remain dysfunctional. But the facts belie the crisis narrative.
The second recent development that gives me hope here is CA. You can’t open your paper these days without reading about California’s fiscal progress. A colleague from out there was just bragging to me about their fiscal rectitude, which I told him feels a little like Madonna lecturing you on chastity.
But I take the point. In fact, from where I sit, it looks like Gov. Brown did something I think all pols need to do: explained to the electorate that if you want service X (education, in this case), it’s going to mean raising revenues Y.
And it worked. I even recall seeing former Romney economic adviser Glenn Hubbard making the same point the other day, something to the effect that people have to decide if they’re willing to pay for the services they want.
I know that’s simplistic and leaves out a lot. I know that we will have national disagreements about that question, though it’s fair to say that the election certainly provided an answer pointing more in, say, my direction then Glenn’s. But if my analysis of what happened out there is even partly correct, I think it’s an important step toward realism, sanity, and fact-based analysis, and away from ideologically driven crisis-mongering.