Thursday, May 16, 2013

Honey, They Shrunk the Deficit

The federal budget deficit — what had once been the portent of the Apocalypse and the destroyer of worlds — at least according to the Republicans who created it — has been tamed and caged, according to Ezra Klein and the Congressional Budget Office.

Here’s the short version: Washington’s most powerful budget nerds have cut their prediction for 2013 deficits by more than $200 billion. They’ve cut their projections for our deficits over the next decade by more than $600 billion. Add it all up and our 10-year deficits are looking downright manageable.

Well, then, it’s a good thing these scandals happened to come along.  Otherwise, what would they have to talk about on Morning Joe?

As with everything, though, there is a downside.  As digby notes, the shrinkage of the deficit comes about by cutting services and providing for the ones who need them.

This deficit hysteria has led to massive casualties in the country and around the world — an entire generation has been delayed in even starting to seriously pursue its hopes and dreams, millions have lost their jobs and their homes and have had to start over and the rest of their lives are going to be financially insecure because of it. We have a huge group of long term unemployed who nobody cares about and who are probably never going to be employable again. We have more poverty even as the wealthiest are once again drowning in a sea of money, richer than they were before the financial crisis began. Austerity isn’t to blame for all of it, but there can be no doubt that the constant garment rending over deficits has made it impossible to even talk about doing what’s necessary to fix the real problems we’re facing.

But yay, we cut the deficit.  As Paul Krugman sees it, that’s all that matters to the Very Serious People (VSP).

Yes, there are longer-term issues of health costs and demographics. As always, however, these have no relevance to what we should be doing now — and it’s far from clear why they should even be a priority for discussion. As I’ve written before, the VSP consensus seems to be that to avoid the possibility of future benefit cuts, we must commit ourselves now now now to … future cuts in benefits.

Why, it’s almost as if the real goal was to make sure that benefits get cut even if the fiscal outlook improves.

Meanwhile, our policy discourse has been dominated for years by what turns out to be a false alarm. To the millions of Americans who are out of work and may never get another job thanks to premature fiscal austerity, the VSPs would like to say, “oopsies!”

So now all those people sitting at home out of work can be proud of the contribution they’ve made to getting our fiscal house in order.  Yip effing yah.