Grasping Reality on TypePad, by Brad DeLong

UPDATE: Jon Henke writes:

I must object to the caricature you've made of my views in your recent post.

I'm not a Bush cheerleader. I never voted for him, and have been a vocal critic. I know you probably haven't read much of my writing - I object to that, too! - but I've been quite critical of the Republican nonsense about tax cuts solving revenue problems, as well as the game of fiscal chicken they're playing by cutting taxes and increasing spending.

What's more, I've actually pointed out previously that Krugman has been quite consistent in arguing that, while fiscal policy is generallly an inappropriate tool to address recessions, it becomes a more legitimate tool when we've run out of monetary rope. Indeed, in that post you cite, I point out that those fiscal stimulus arguments are certainly legitimate.

However, the deficits over the upcoming decade are massive, and we're hearing the same deceptive "but we'll cut these massive deficits in half" rhetoric and number-manipulation that we saw before.

I certainly understand why you haven't exactly been following what I write. I mean, I think that's a tragedy, etc, etc, but I understand you probably have things to do beyond hanging on my every word. But, even though I'm sure it is unintentional and not personal, you have misunderstood and misrepresented me.

I only write to point that out because I like and respect you, and I hate to think our rare intersection would be a misunderstanding.

Jon is right.

I am clearly far too cranky this evening.

I apologize.

Nevertheless, there are two important points:

1. We need to worry about the deficits in 2015, 2020, 2025, and beyond--not about the deficits in 2009, 2010, and 2011.

2. The key to dealing with the deficits in 2015, 2020, 2025, and beyond is--you guessed it--health care. That is the entire ballgame.

rmoomaw writes:

What in your opinion is wrong with this analysis?

John Henke, Doubling Down on the Deficit Disaster | The Next Right.

I reply:

r (if I may):

1. The long-run deficits that John Henke decries are not much, much worse than they were in 2003--they are somewhat better. Obama has cut the long-run deficit. Bush boosted it. It remains a big problem--but it's not a problem of Clinton's or Obama's or Pelosi's or Reed's creation, it's a problem created by Bush and his cheerleaders like Jon Henke.

2. Henke accuses Paul Krugman of inconsistency for worrying about deficits in 2003 but not about short-run deficits now. If the 2003 unemployment rate had been forecasted to be above 10%, Krugman would have been calling for bigger deficits in 2003 as well. I don't know whether Jon Henke is foolish or mendacious, but "cyclical deficits when the economy is in deep recession good; long-term structural deficits bad" ought not to be too complex a doctrine to be grasped by someone who claims to be speaking for the Next Right.

I think that takes care of it.

Yours,

Brad DeLong