Monday, March 14, 2011

Broke Is Spin -- But So Is Balanced Budget Talk

I agree with all of those who are saying today and recently that the United States is not, in fact, broke.

Of course, if you consider revenues permanently off the table no matter what...well, then, you wind up thinking that the nation is broke. And it's certainly a legitimate policy position to hold -- to say that any major changes in the federal government's budget can only come on the spending side. But neutral analysts and reporters really should recognize that "broke" is spin, not description.

The one thing I'd add is that there's a tendency among even those who don't buy into "broke" talk to add, in a "to be sure" paragraph, something to the effect that the US cannot run a budget deficit forever. That's simply not true. Running a budget deficit has consequences -- but it's highly contested whether those consequences are large or small, or even negative or positive. It is simply not neutral to set up either a short-term or long-term balanced budget as a policy necessity.

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