Here’s the problem I have with the recent furor over the deficit and the debt: my long term memory still works. See, I remember George W. Bush. I know it was a long time ago (eighteen months), and for those with the memories of fruit flies, let me remind you: the debt philosophy of the Bush administration, as articulated by vice president Dick Cheney, was “Reagan proved deficits don’t matter”. And they lived by this philosophy. The debt in 2001 (Bush’s first budget) stood at $5.8 trillion- by 2009 (Obama’s first budget), it stood at $11.9 trillion, and increase of over $6 trillion. Over 8 years. That’s an average of $750 billion in new debt every year W was president. And, outside of the liberal blogsphere and Paul Krugman, I don’t remember anyone saying a god damned thing about the deficit. For eight years.
But then, some time in 2009, something changed. The deficit “hawks”, who had spent eight years silent, suddenly awoke to the massive danger the debt posed, and took up their abandoned positions yet again. Now, all of a sudden, we’re treated to daily broadsides on the danger of the debt, and the need to eliminate the deficit immediately. Which leads me to ask: why now?
A word on Occam’s razor, as it will come up- Occam’s razor only applies between two theories that explain (“fit”) all the data. If a theory doesn’t explain all the facts, the fact that it’s simpler is irrelevant. So the plaintive cry that we can’t keep deficit spending doesn’t explain why you (and everyone else) were silent during the Bush years (if you were not silent, please post links- and the following comments don’t apply to you).
The one theory I’ve come up with that fits all the facts is that it’s not the deficit that matters- but what the deficit is spent on. Spend the deficit on wars and tax cuts, and that’s OK- but spending the deficit helping the poor, the sick, the unemployed, the hungry- what the heck do you think this is, a Christian nation? The ruling ideology around these parts is Darwinism- Social Darwinism, to be precise.
This theory is especially accurate in predicting the deficit “hawks” response to current budgetary items. Even if you accept that now the deficit is a problem in a way it wasn’t eighteen months ago, doesn’t it make sense now to allow the Bush tax cuts to expire, and to end the wars in Afghanistan and Iraq sooner rather than later, on the grounds that we can’t afford them? And wouldn’t it make sense, as a deficit hawk, to support legislation that saves more money than it costs? Take, for example, health care reform- which yes, costs $900 billion over the next 10 years, but saves $1.1 trillion (for a net savings of $200 billion), as the health care bill did. Granted, that’s a small savings, but as a deficit hawk, doesn’t every little bit help?
This theory also explains why, according the Republicans, extensions to the unemployment benefits must be fully paid for- but extending Bush’s tax cuts don’t. The alternative theory I have- that deficits are OK if a Republican is President, but not OK if a Democrat is President, doesn’t explain the deficit “hawk” stands on these current issues.
Note that it can make perfect sense to have opposed the Bush deficits at the time, and support the Obama deficits now, and not be just a Democratic partisan (“deficits are OK if a Democrat is President”). The theory here is to save for a rainy day, but that if it’s raining, now is the time to spend the money you have been saving. And it’s economically raining cats and dogs right now- the highest unemployment rate since the great depression is predicted to continue to be high for years, and we’re up against the zero bound (the Fed can’t lower interest rates below 0%), so conventional monetary policy (lower interest rates to stimulate the economy) doesn’t work. So now is a really good time for some Kenynesian stimulus spending, with the understanding that when the good times return, we pay off/down the the debt.
A school administrator once explained to me, when I asked why I was being punished for being attacked, that it wasn’t a fight until I hit back. By this definition, what the deficit “hawks” are doing is not class warfare. After all, it’s not a class war until the other side fights back. But this does explain why my reaction to these so-called deficit hawks is the same as my reaction that administrator, years ago.
Bite me.
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