The Libertarians' Bogart Moment

…and the yield on 10-year Treasury notes hits 4 percent, after an "awful" auction of $19 billion in new government debt. There are many claims about why demand is declining for 10-year bonds backed by the full faith and credit of the United States. Optimists say it indicates impending inflation and thus higher interest rates (and in today's Wall Street Journal, non-optimist Arthur Laffer says inflation is a-comin'). An even more pollyanish view is that investors are finding oodles of neat stuff to put their wealth into as the economy resurrects.

One thing is certain: Big buyers are losing interest in U.S. government debt. There is a clear upside to this, because of the distance between promised largesse and the issuing of debt to pay for it. As Katherine Mangu-Ward noted earlier, the never-popular American Reinvestment and Recovery Act is less popular than ever. Very little of the ARRA's funding has actually been committed. In April the GAO estimated that only $49 billion of $787 billion in stimulus funding was committed to be paid by September 30. A Pro Publica article today tracks the relative chump change that has been paid for transportation, supposedly a cornerstone of the stimulus package.

This means theoretically it's still possible to walk back the stimulus payout, if you can make a political case for it. One way is to use the kind of magic talk politicians love: For every dollar we don't borrow at 4 percent now, we save almost $1.50 over ten years!

For libertarians, the Bogart Moment is an even bolder argument. I've always hated the Bogart Moment, that never-convincing scene where Humphrey Bogart or George Clooney or Ice Cube or Han Solo decides to give up pursuing his own interest and jumps in with the team for the big win.

But in this case, the Bogart Moment could yield wonderful rhetorical results: We don't want to kibosh the stimulus out of buy-gold megalomania or toe-tapping hatred of age-of-consent laws or nostalgia for the days of the Articles of Confederation. This is just patriotism: We just don't want our government bankrupt itself. We're here to help.

Here, by the way, is what happens when you ignore the Bogart Moment, you nattering popinjays: