[Family’s away, can’t do yard work given the rain (well, could do some, but don’t want to), so better to sit on the back porch with an intravenous coffee feed and blog the weekend papers…right?]
I will assert that I have solid street cred when it comes to tamping out deficit hysteria everywhere I see it. I have consistently inveighed against austerity, blood-letting, and hypocrites who pretend to be fiscal hawks but really just want to slash and burn the public sector.
That said, I thought this WaPo piece made a decent point, up to a point, on the fact that even with recent, significant improvements in the fiscal picture, we are not out of the fiscal woods.
In this biz, you need to be a CDSH—cyclical dove, structural hawk—and in that regard, the deficit is coming down to fast now when the sluggish recovery still needs fiscal support and going up later when it shouldn’t be, as shown in the figure here. So there’s reason, as the Post piece suggests, to be mindful of the SH part of that acronym above.
Here’s, however, where I depart with most of the SH’s cited in the article, and with the use of the word “urgency” in this debate, and I think this is a very important and salutary distinction. This is neither the time nor the Congress with which to make fiscal deals that will be in the nation’s economic interest. The improving budget picture and especially the slower growth of health care spending (since that, along with reduced revenue collections, are where the fiscal pressures are coming from) give us some breathing room.
This conclusion about timing stems from the fact that many conservatives in the current debate have two goals: to avoid new tax revenues and to cut non-defense spending, including supports for economically vulnerable people and social insurance. Moreover, they are thoroughly uncompromising in those pursuits. Therefore, I view the recently improving fiscal picture as an excellent reason for not making rash deals with those who would do long-lasting damage to our safety nets, public goods, and social insurance.