Budget

Don't Regret the Debt?

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Robert Kuttner is irked that some folks are anxious about rising public debt levels when what the U.S. really needs to be doing is spending, spending, spending.

Kind of like the currency in "Fallout 3"

In one "storyline", he says, "the most dire peril facing the economy is the increasing public debt." But, he argues, "the more immediate problem is the high unemployment rate, the risk of a largely jobless recovery, and a lost generation of prosperity." He's worried that those who want to cut spending on social services—otherwise known as entitlements—have effectively already won the public debate.

We need a national debate on this basic choice, with equal prominence for the folks who want to gut social spending and deliver austerity, and those who propose a high road to fiscal stability. But nearly all the resources and the largest megaphone are on one side of the debate.

But the idea that mounting public debt poses a serious problem is hardly just a storyline. Moody's has already warned that the U.S. may lose its platinum credit rating, and the Congressional Budget Office is projecting that public debt could equal 90 percent of GDP in just a decade—perhaps sooner. That's well above the generally accepted 60 percent threshold for developed economies, and at the point where serious economic troubles start to develop. It's tough to say exactly what the consequences of such high debt levels will be, but as the folks at CRFB put it:

At some point, investor sentiment will shift, at the very least because judgment over the risk:return ratio for relative assets will change as the global economic and financial situation changes. How will investors then regard U.S. government assets relative to other assets in the United States and around the world? With our domestic savings gap likely to remain large, we will be increasingly vulnerable to a shift in investor sentiment as our public debt leverage rises.

But Kuttner never deals with any of this. Instead, he grumbles about Alan Greenspan, Bob Rubin, and the fact that Bill Clinton was given the "courtesy title" of "President" in a flyer listing guests at a fiscal summit (unbelievable, I know!).

And you have to wonder: Why is he so concerned? Despite his worry that one side of the fiscal debate is louder than the other, the policy action is almost entirely on his side: In the past year and a half, we've bailed out banks, passed a massive fiscal stimulus, and tagged a trillion dollars for expanding access to health insurance. Yes, President Obama has set up a fiscal commission to look at debt and deficit issues, but it's not terribly powerful. As far as I can tell, it's Kuttner's viewpoint that's winning: Spending, spending, spending is exactly what we're doing.

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  1. and those who propose a high road to fiscal stability

    “High road” meaning high taxes here. That’s some good wording, Lou.

    1. “And it says here that it’s illegal to put squirrels down your pants for the purposes of gambling.”

  2. This moron apparently thinks money grows on trees. Just imagine his surprise when interest payments start to displace welfare spending.

    Fake edit: Awesome alt-text.

    1. No, awesome would be noting that it’s kind of like the currency in Fallout. But not like the currency in Fallout 2, which was more appealing to a certain class of libertarian. Kids these days.

    2. Sometimes I wonder if all my liberal friends will someday realize there’s a vast difference between having the good intentions of extending health care to 32 million Americans and actually accomplishing the extension of health care to 32 million Americans. No matter how many things go wrong with their good intentions, they’ll just find a way to blame the bad on Republicans.

  3. Maybe he thinks we should start bailing out the states (more than the one-time stimulus). That looks like a real path to prosperity.

  4. He’s worried that those who want to cut spending on social services?otherwise known as entitlements?have effectively already won the public debate.

    Doesn’t matter if we have. Washington has already shown that they will not listen to the electorate. Again I ask “Can the Republic be saved?”

    1. Yes, it can, and in much the same way our troops used to save villages in Vietnam.

      1. We will raze the countryside in a fashion reminiscient of Genghis Khan.

        1. That’s “Jen-Jiss,” monsieur.

      2. I dunno, if the “village” is the entire US, it seems like most of the problems are centered around one “hut”.

        1. When I hear things like that, I reach for my flamethrower.

  5. …what the U.S. really needs to be doing is spending, spending, spending…

    We’ll spend our way to prosperity!

    Could anyone but a public intellectual be so stupid?

  6. those who propose a high road to fiscal stability.

    WTF?

    1. Either it’s a crypto-argument to legalize and tax drugs, or he’s high. I can’t tell.

  7. Well we could do like some people who are planning to declare bankruptcy–borrow all the money you can and pay for everything you might need for the next 10 years or so. Then say “sorry, I can’t pay” and if you have more guns than your creditors you should be OK :–)

    1. We can just tell our creditors we did it for the lulz.

    2. No, I believe when the US decides to say “fuck it, we won’t pay”, the NWO moves ahead with their plan to seize control of Tardville, D.C. by inducing strokes in politicians and controlling them via neurological medical prostheses. According to Neal Stephenson, anyway, and he’s never wrong.

  8. ps- Who the fuck is Robert Kuttner?

    1. He’s known as “Crazy Bob,” for reasons that should be apparent.

    2. HEY!! Are you making fun of my name?!

  9. Has there ever been a “largely jobless recovery”?

    One that the government didn’t cause, that is.

  10. We need a national debate on this basic choice, with equal prominence for the folks who want to gut social spending and deliver austerity, and those who propose a high road to fiscal stability.

    You will see this debate pick up on November 2. Not sure about the “equal prominence” part, though.

  11. Did that graphic come from the NH Advantage Coalition?

  12. Reason, Matt Welch, Nick Gillespie,
    Want a 500 comment item on your website today? then post the Wiki Leaked Collateral Murder? story.

    The story is gonna get bigger and you will eventually have to acknowledge it:

    1.Destroying a makeshift ambulance promotes terrorism in all it’s forms. This does not make us safer.

    2.Destroying a makeshift ambulance does not make oil cheaper. The brainwashed set here seem to still cling to the idea that we are in Iraq for “cheap oil” which is the LEAST believable reason for the war. Bush and Cheney came into their presidency making many public statement about the horrors of “cheap oil’. Saudi Arabia(the close US ally and islamo fundamentalist redicalizing agent) repeatedly threaten Sadam because he was producing “too much” oil. Bush-Cheney texas buddies were particularly hard hit by $15,$20 and $30 oil because they were marginal supplier int he world market at those low prices!
    3.Destroying a makeshift ambulance is not gonna spread “democracy”.

    Thus, all the official reasons for us wasting our resources in the middle east are BS. If you do not acknowledge that then you are in fact not “supporting the troops”….you are helping send kids to their death for BS reasons.

    1. Yes, but what about the chemtrails?

      1. Pay no attention. That is the “rainbow” seeding initiative that Obama signed into executive order.

    2. Your tinfoil is showing.

      1. Someone must have slipped him some HFCS. That’s how they silence the truthsayers.

        1. Is HFCS in the chemtrails?

          1. No. There was a different reason why Epi’s face got all sticky the last time he looked up.

          2. It’s in EVERYTHING

            1. Not quite Epi. You should really orally pleasure a better class of prostitute.

    3. The John vs Tony dialog alone will exceed 500 comments.

    4. meh, i saw the video, basically a group of men with AK-47s walking around, one of them with a long tube-like device kept popping around the corner pointing it at US troops & vehicles, so an Apache shot them up, and then an unmarked black van which came up and started loading guys in also got shot up

      turns out it was reporters using a long telephoto lens to take pictures of US troops, guarded by a group of armed guys

      so 2 stringers for Reuters were killed, along with their guards

      obviously, looking back it was a mistake and they should have done a bit more to establish who they were shooting at, but certainly not intentional or ridiculous

    5. You know what the difference is between shooting a big gook and a small gook?

  13. Hey its just money, no big deal right? I mean really.

    Lou
    http://www.anonymous-surfing.us.tc

  14. I’m always telling my boys that what you do is much more important than what you say. That’s why excuses don’t go very far.

    Lately we’re seeing Democrats doing horrible things while complaining about what others are saying.

  15. Going hysterical over the debt is part of a three-pronged fiscal policy approach of the GOP: reduce the debt, don’t raise taxes, and don’t cut spending. The unicorns and fairy dust are assumed. Economists Dems listen to (those guys who haven’t been proven catastrophically wrong by recent events) know that the debt isn’t the biggest immediate problem. But it is something their opponents can bash them over the head with.

    1. There’s a flaw in the GOP approach, Tony, and I’ll fix it below:

      Reduce the debt, don’t raise taxes, and cut spending.

      Beats the dog-fuck out of hiking taxes, raising the debt, and putting virtually every American on the handout trolley.

      Of course, you’ll disagree.

    2. No, the immediate problem is the smothering of the productive sector in America by the parasitic class and their grasping cabal in Congress. The sooner we can pry its sucker-shaped mouth off the public tit, the better off we’ll all be.

      1. I totally agree. Productive workers have been sucked to death by the parasitic class (the rich) for decades.

        1. Being rich in of itself is not a crime nor even morally wrong, getting rich by leaching off the public teat should be both. It’s an important distinction that lefties don’t seem to understand.

        2. You know what? I’m tired of your classist bullshit. Put up numbers or shut the fuck up. How much money should a businessman be allowed to make before he is considered evil?

          No “less than they make now” cop-out answers, either. If the rich make too much, and make it off the backs of the humble commoners, draw a line.

        3. Productive workers have been sucked to death by the parasitic class (the rich) for decades.

          Yeah, because we all know that rich people would rather do drugs than work, right ?

    3. The Dem economists (aka Keynesians) were already proven catastrophically wrong when they prolonged the Great Depression out over a decade and left us today with $100 trillion in unpaid entitlements over the next century by programs that have far exceeded their cost estimates because they were very poorly planned. And in case you never noticed, the Democratic states and the highly Keynesian countries are by far the worst off these days. So I beg to disagree. Moreover, Keynesianism and the devaluation of the currency is regressive, as the poor bear the disproportionate burden of price inflation.

    4. Economists Dems listen to (those guys who haven’t been proven catastrophically wrong by recent events)

      That eliminates all Keynesians, since they were the ones who were busy cheering on the housing and credit bubbles while Austrians were sounding the alarm. And now they want to repeat the exact same policies that gave Japan 2 decades with no nominal economic growth and the highest debt in the developed world (not to mention wiping out the Japanese population’s savings, a truly impressive feat).

    5. our debt problem is nothing but fictitious pixie dust spread through GOP fear mongering . . .

      in other breaking news from the dimension of Bizarro World, Lindsey Lohan wins the Oscar for Best Actress.

    6. Economists Dems listen to (those guys who haven’t been proven catastrophically wrong by recent events) know that the debt isn’t the biggest immediate problem.

      The same economists that thought that the debt was an enormous problem when it was under Republicans but being used to cut taxes.

      Sure, both parties are hypocritical on the debt and deficit, only caring about it when the other party is in power.

    7. Economists Dems listen to (those guys who haven’t been proven catastrophically wrong by recent events)

      Dems listened to the economists at the Ludwig Von Mises Institute?

      1. No they only listen to the ones that are vague enough that they cannot be proven wrong.

    8. Still waiting for your answer on the seatbelt thing. But anyway, onto new adventures!

      The GOP is just as guilty in recent years of overspending and that is why many of them are called RINOs. That being said, the debt really is a big problem. Very few liberals can seem to answer this question, but I shall put it to you:

      If running a household this way leads to bankruptcy, foreclosure and otherwise Bad Things, why is our government allowed to get away with it?

      Pretty much everyone above me points out the fatal flaws in Democratic reasoning.

      1. Steff, have ya got a currency printing press? No?

        Well, Teh Gubmint does, and neither party can resist spending cash like drunken sailor.

        1. (Actually, I kinda do… but that’s not really important. I don’t plan on printing currency on the letterpress anytime soon.)

          Right, I know they do. But eventually, that paper becomes absolutely worthless. So, the question stands.

      2. If the entire Republican Party is classified as RINO, then what does Republican mean?

        1. It means ‘joke’. It has for quite awhile.

  16. But nearly all the resources and the largest megaphone are on one side of the debate.

    Kuttner ought to try to get that Obama dude on his side; man, I see that guy in the paper and on the TV like, every day! And I hear he loves government spending!

  17. HEY!! Are you making fun of my name?!

    There once was a man named Kuttner;
    He tried to stick his butt in ‘er,
    Because he’s an economist.

  18. “the most dire peril facing the economy is the increasing public debt.” But, he argues, “the more immediate problem is the high unemployment rate, the risk of a largely jobless recovery, and a lost generation of prosperity.”

    To summarize, we’ll get to that pesky, ruinous debt just as soon as all the other problems facing our nation have been dealt with and solved, not to mention all those other social programs that Teddy Roosevelt, Jesus and Plato himself fought for but couldn’t get the Party/Temple/Polis of “No” to go along with.

  19. The language is very manipulative: “gut social spending” and “deliver austerity” versus “high road” and “fiscal stability”.

    The kind of people that don’t parse this kind of language are the people that don’t read these articles, I don’t know why such disingenuous language has to be used other than pure partisanship.

    Kuttner wants abundant social services and Keynesian spending… that’s what we have! The only reason to argue in their favor at present is because you think we’re not going far enough, which to me is nearly unthinkable.

  20. Economists Dems listen to (those guys who haven’t been proven catastrophically wrong by recent events)

    Like Krugman?

    1. I’d STILL suck Keynes’ dick.

    2. Again, two words: “Greece, California”

      1. But they spend like Socialist and want to live like Libertarians in California! Or is it spend like Libertarians and want to live like Socialist in California? Or they vote like Libertarians and govern like Socialist? Vote like Socialist, and govern like Libertarians?

        Can’t you tell I have been calling it, and have been since WFB randomly selected me from a student audience to distract their attention when he was suffering a massive hang over. Without that infamous Catholic guilt and self doubt, I would never have landed this gig. I don’t mind sharing that with you, but don’t tell the clowns that edit this hack shop. They think I’m one of you.

    3. Krugman was arguing that the deficits and debt under Bush would inevitably lead to way too high interest rates, even though the market wasn’t reflecting it yet. He’s completely reversed now, of course.

      What makes it worse than a tie for Krugman is that the current deficits (and projected future deficits over the next 10 years in expected recovery) are far worse than under Bush. An argument of “it wasn’t bad enough to cause a crisis under Bush, but this will be worse” is at least somewhat valid. (Not talking just about the current deficit, but the projected 2015-2019 deficits.)

  21. last fiscal year’s interest expense was 383 billion dollars. At a near-zero interest rate.

    What will we be paying in five years?

    Keep spending, America!

  22. Beats the dog-fuck out of hiking taxes, raising the debt, and putting virtually every American on the handout trolley.

    Of course, you’ll disagree.

    Keep in mind, The Libertarian Guy, that Tony truly believes everyone on Hit’n’Run besides himself is a Republican. His tiny mind is not capable of envisioning more than two points of view on any issue.

  23. Kutter, being an academic paper pusher, truly believes that borrowing is income, debt is wealth.
    And I am sure that he is a secular man, and probably would have little use for religious people. But ironically, he is at the top of a pyramid of high priests, AKA economists, who seem to think that pieces of paper (i.e., federal reserve notes), if only distributed and managed by the priesthood, would lead to heaven on earth.
    The belief in dollars, as a surrogate for thrift, hard work, honest return, store of value, is as fragile as an egg – once broken, it can never be restored.

    1. Who knew I’d be in company with such prominent economists as Kutner when, at age 10, I thought if the government would just give my dad, and every other dad, a million bucks we’d all be rich, rich, rich!

  24. Please, please, please liberals, take this guy Kuttner’s advice. Don’t be shy; pick up that megaphone and give your best full-throated defense for endless debt, currency devaluation, and zombie economics. I’m literally BEGGING you to do this.

    1. Look what it did for us!

    2. Us too! Opa!!

    3. Jambo!

  25. Kuttner is just another worthless economic pundit who will taste good with bar-b-q sauce when the SHTF and these clowns become currency and/or my food supply.

  26. In the future, toilet paper will be scarce and expensive, but thankfully T-Bills will be abundant and cheap.

  27. “”Robert Kuttner is irked that some folks are anxious about rising public debt levels when what the U.S. really needs to be doing is spending, spending, spending.””

    I would like to do more spending, but the government keeps taking more of my money.

  28. Someone send Kuttner the Dr. Phil episode where he explains you can’t solve money problems with money.

  29. Productive workers have been sucked to death by the parasitic class (the rich) for decades.

    Do you dress up in a Mao suit for Halloween, Comrade?

    1. He’s absolutely right. And to solve that problem, he supports requiring people to purchase crappy services from large, faceless, bureaucratic corporations under penalty of law.

  30. Money problems can be solved with guess what? Money!!!

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