DC’s deficit frenzy

The entire political world has descended into a deficit frenzy that rivals the mass hysteria of the Salem witch trials. The mania has been growing for months, but exploded last week when D.C. heartthrob Rep. Paul Ryan of Wisconsin (R) unveiled what was widely received as the most important document since the Emancipation Proclamation and the entire political establishment started babbling about “brio” and “courage.” 

Nothing else matters at this point — not anemic economic growth, not sustained, shockingly high unemployment, not a Middle East uprising of world-changing consequence — not even an epic nuclear catastrophe.

Sen. Saxby Chambliss (R-Ga.) said on CNN this week that the deficit is “the most significant national security interest that the United States is facing today.” And that’s with the U.S. currently involved in three wars! (Well, two wars and one “kinetic military action.”)

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Oddly, even with budget terror consuming every waking moment, many insist on tackling a projected shortfall in Social Security that will not materialize until 2037. In fact, it is currently in surplus, safely invested in U.S. treasury bills that help finance the government.

Nonetheless, they insist that this potential problem far into the future must be dealt with immediately. Former Sen. John Warner (R-Va.) explained Monday, “What we want to make sure is that there’s going to be Social Security 75 years from now, and the idea that we should just punt on this problem because there is still some money left in the trust fund makes no sense to me.”

Considering the lack of interest in the job-creation crisis or the looming catastrophic future crisis of climate change, this nonsensical insistence on injecting Social Security into the mix can only be seen as another symptom of the deficit delirium that has overtaken the Capitol.  

It reached such a pitch that last week the government was nearly shut down over spending on Pap smears and the president, a man commonly accused of being a socialist by political rivals, rushed to take credit for the largest spending cuts in history. One would have thought that would break the fever, but it shows no signs of abating.

Today the political world anxiously awaits the unveiling of the president’s plan for long-term deficit reduction, rumored to be based upon the recommendations of the co-chairmen of his deficit commission when they could not find consensus among members.

Nobody knows specifics, but everyone agrees that he must cut “entitlements,” the specter that haunts the febrile dreams of everyone in Washington. Unless some old and sick people are thrown onto the bonfire, they believe we will never purge the deficit demon from our body politic.

There are those who seem to be immune. Investors appear unmoved by the frenzy, buying U.S. treasury bonds even at historically low interest rates. Respected economists aren’t affected either, pointing out that the more immediate concern for our economic health is slow growth and high unemployment. According to Paul Krugman, more than half the deficit was caused by the plunge in tax receipts and the need to stimulate the economy, so big deficits at a time like this are both appropriate and necessary. 

Government spending didn’t cause our economic problems, and it’s delusional to think cutting it will solve them. But the powers that be are apparently going to forge on and try to immediately “reform entitlements” to prove that they are Very Serious about purging the phantoms the moneyed interests have created to explain why the American Dream is turning into a nightmare. Let’s hope this fever burns itself out before it causes permanent damage.

Heather Digby Parton writes the Santa Monica-based
 liberal political blog Hullabaloo. You can follow the blog at http://digbysblog.blogspot.com.