Are deficit hawks extinct?
Are deficit hawks an extinct species?
The Greek philosopher Diogenes used to walk around carrying a lantern, looking for an honest man. Were he to seek a deficit hawk today, he would probably burn through plenty of lantern fuel.
Deficit hawks place deficit and debt reduction at the top of their wish list. If you could find one today, he or she would likely look to both revenue boosts and spending cuts to accomplish the goal.
Since the start of the 21st century, under both Republican and Democratic control, Washington has consistently shot down deficit hawks.
The latest iteration of that sport took place with the recent federal tax rewrite, which nearly all economists, including the official congressional analysts, predict will add at least another $1 trillion to the federal debt over the next 10 years. That’s after factoring in potential economic growth from the tax cuts.
Twelve zeroes — but apparently no one’s counting.
In percentage terms, another trillion dollars is chicken feed, and deficit hawks no longer seem interested in that delicacy. The federal debt is already about $20 trillion.
Toward the end of the 1990s the debt worm turned, and the federal government actually found itself in the black for a change. That was cause for celebration for a number of advocates of fiscal responsibility, led by the Concord Coalition, a bipartisan organization that began a few years earlier.
Some members of Congress were concerned that paying off treasury debt might harm the economy!
But not to worry. In the following two decades a combination of tax cuts and spending increases returned the treasury’s debt curve to its accustomed upward trajectory.
Now the economy appears to be booming, with unemployment at a very low level, investment up, wage growth starting and the stock markets at near record highs. Sounds like an ideal time to start reducing the debt.
But no. Not happening.
And the Washington majorities are considering many billions for a border wall, another trillion-plus for infrastructure improvements and many billions more for defense spending increases. All to be paid for with borrowed money.
It’s very hard to find a member of Congress or the administration willing even to consider bringing the annual budget into balance, let alone pushing it into the black.
A few years ago, the Bowles-Simpson committee proposed a series of actions that would put the federal budget on a fiscally sound track. (That’s an effort that deserves rebirth, from either government or non-government sources.) But even that committee couldn’t command the supermajority required by its own rules to recommend the report to Congress.
The U.S. Treasury borrowed $519 billion (the federal deficit) in the fiscal year that ended Sept. 30. In the current fiscal year, the estimate for money to be borrowed by the feds is $955 billion. The reason: the tax cut legislation.
To quote the oft-repeated mantra in Kurt Vonnegut Jr.’s “Slaughterhouse-Five” — “So it goes.”