This article is from: March 18, 2013. We will be hearing about the immediate debt crisis in the next few weeks and months. “We do not have an immediate debt crisis.” In offering up such a stunningly honest admission, the GOP leader has put himself on record as agreeing with President Obama, who has previously acknowledged that demonstrable reality. But the big news here isn’t just about the politics of a Republican House speaker tacitly admitting they agree with a Democratic president. It is also about a bigger admission revealing the fact that the GOP’s fiscal alarmism is not merely some natural reaction to reality, but a calculated means to other ideological ends. Before considering those ends, first remember that Boehner (like Obama) is correct on the facts. As Nobel-winning economist Paul Krugman has pointed out, “Even if we do run deficits, federal debt as a share of GDP will be substantially less than it was at the end of World War II” and “it will also be substantially less than, say, debt in several European countries in the mid- to late 1990s.” It is also lower than the 80 percent of GDP level that many economists say starts to put countries in a precarious position. Additionally, citing Congressional Budget Office data, the Center for American Progress notes that the long-term debt outlook is only dire because the projections simply assume without question that “future Congresses will enact huge new deficit-increasing tax cuts and spending hikes.” “The debt outlook is bad (but) we’re not looking at something inconceivable, impossible to deal with,” writes Krugman. “We’re looking at debt levels that a number of advanced countries, the US included, have had in the past, and dealt with.” So yes, we should start dealing with the long-term debt in a pragmatic and sober way, but we shouldn’t pretend it is some sort of imminent crisis worthy of draconian austerity measures.
Posted on: Mon, 02 Dec 2013 16:52:01 +0000