Debunking Deficit Hysteria

As John McCain used to say, it’s time for a little straight talk. Here’s mine: Americans don’t care about the deficit. That’s not to say that the public won’t be angry if the country goes broke, defaults on its loans or gets swallowed up by China. But poll after poll shows that Americans care far more about lowering the unemployment rate than lowering our national deficit and debt. The views of the public happen to be directly at odds with the political and media class in Washington, who are practically foaming at the mouth these days while urging the Obama administration to get “serious” about cutting popular and long-establishment entitlement programs, like Social Security and Medicare.

One example of the public point of view: in a CBS News poll immediately after the 2010 election, which supposedly resulted in a Tea Party mandate, 56 percent of Americans ranked the economy and jobs as their top priority for the new Congress, while only 4 percent named the deficit. In mid-January, CBS News and the New York Times once again asked: “Which of the following do you think is the most important thing for Congress to concentrate on right now?” Forty-three percent of Americans chose job creation, compared to 14 percent for the federal budget deficit. Perhaps the administration possesses polling showing that moderate Republican soccer moms in Cincinnati prioritize the deficit above all else, but the rest of the country does not.
http://www.thenation.com/blog/158601/debunking-deficit-hysteria

If we are in a recovery, then where are the jobs?

I find it interesting that Egypt's official unemployment was 9.6% in 2009. Does that sound familiar?

Yet all of a sudden the talking heads are telling us Egypt's unemployment is really 30, 40 or even 90 percent. Only when people were protesting did our corporate media decide to take a closer look at unemployment in Egypt.

Maybe we should take a closer look at unemployment in the US or maybe we should simply protest like Egyptians.

I don't understand the point of this article.

The economic policy of the federal government should be based on a CBS poll?

The federal government should borrow without restraint to stimulate 'growth'?

Clearly, Berman and Hayes and the poll respondents who say that the federal government shouldn't care about the size of the annual deficit and the federal debt don't understand how our economy works.

Our currency is already becoming worth less everyday that the Federal Reserve pumps billions of 'magic' dollars into the banks ('quantitative easing'). Can you imagine how debased our money would become if the federal government just borrowed trillions more?

The truth is that the interest we're going to be paying on our federal debt has already bankrupted the government.

So, the answer is to change the way money is 'created' in this country, ie., abolish the Federal Reserve and have the Treasury directly issue currency; or default on the federal debt; or end two wars and cut the Pentagon budget and raise taxes on the wealthy (we all now now that is NOT the Obama plan) .... etc.

Take your pick, but unlike the tone of the article, there aren't any painless answers -- and ultimately no answers at all because of the way our politics works these days.