Should-Read: Dumb from Professional Republican John Cochrane. He missed the deficit pivot moment. The Republican Party line was: "The tax cut's and the spending deal's deficit effects are no big deal". It turned into "We must slash social security and Medicare now". Cochrane was still spouting the first line a week late—but he then made up for lost time: ProGrowth Liberal: Fiscal Stability or Dire Straits: John Cochrane’s Latest Rant: "John Cochrane babbles on incoherently on what should be a straightforward issue...
...Once you net out interest costs, it is interesting how sober US fiscal policy actually has been over the years. In economic good times, we run primary surpluses. The impression that the US is always running deficits is primarily because of interest costs. Even the notorious "Reagan deficits" were primarily payments, occasioned by the huge spike in interest rates, on outstanding debt...
Then comes his update!:
The US fiscal situation is dire. The debt is now $20 trillion, larger as a fraction of GDP than any time since the end of WWII. Moreover, the promises our government has made to social security, medicare, medicaid, pensions and other entitlement programs far exceeds any projection of revenue...
He went from fiscal policy being sober to we are in dire straights just like that! Oh my the sky is falling. We have to take away those Social Security benefits.... Give me a break!
