You knew it was coming:
Some White House officials have gone as far as exploring policies such as automatic spending cuts as the economy improves, or prepaying Social Security benefits to workers before they become eligible, although these measures are unlikely to advance given the political stakes, said these officials and advisers, who spoke on the condition of anonymity because of the sensitivity of internal deliberations.
To begin with, two key points: 1) due to pedal-to-the-metal fiscal stimulus policy, interest rates are incredibly low so debt is very cheap, and 2) a Great Depression from inadequate stimulus during a pandemic will have far larger long-term impacts on both the debt and the deficit than up-front stimulus to maintain GDP and consumer demand.
And that’s without even delving into conversations about the macroeconomics of deficits, Modern Monetary Theory and similar questions about just how much deficits matter in the grand scheme of things. Doomsayers have been predicting hyperinflation just around the corner any day now for decades, with laughable success rates. If policymakers took the real threat of climate change as seriously as they take the phantom threat of deficit-fueled inflation, America would already be a green energy paradise–and with a jobs program ironically powerful enough to shrink our debt obligations.
But let’s be very clear: Republicans don’t actually care about the whit about the deficit and never have. Every time Republicans hold power they cut taxes for the rich, while falsely claiming that the cuts will pay for themselves. They never do, of course. The Trump and Paul Ryan massive giveaway to the rich was no exception, pushing the deficit up by at least $100 billion to over $1 trillion. Because of those tax cuts, government revenues actually declined during ostensibly boom times when they should otherwise have risen. Similarly, the Bush tax cuts were responsible for a nearly $2 trillion reduction in revenues during the 2000s. And, of course, the initial explosion of debt and deficits occurred during Ronald Reagan’s administration of guns, butter and tax cuts for the rich.
It is, rather, Democrats who perversely and consistently bear the brunt of reducing deficits. Barack Obama reduced the deficit by three quarters during his administration. Bill Clinton left office running budget surpluses that were swept away by the Bush tax cuts. Again, from a progressive and modern monetary perspective these deficit reductions are not even desirable. But framed purely from traditionalist deficit hawk standpoints, Democrats balance budgets while Republicans spend like drunken sailors. The end result is a broken politics in which only Republican presidents are allowed to spend money, winning popularity and granting largesse to their cronies then Democrats are forced to implement unpopular austerity and tighten the belt.
Now, during a pandemic, Republicans are laying in a plan to steal your social security to pay for your decimated wages and benefits, while keeping landlords, banks and big corporations fully capitalized. There is no plan, however, to roll back any of the Trump, Bush or Reagan tax cuts for the obscenely wealthy.
Under no circumstance should we be concerned about the deficit during a once-in-a-century crisis of unprecedented unemployment and danger to public health. It shouldn’t even be part of the conversation.
But if it must be, you’ll know a Republican is actually serious about doing something about the deficit when they start talking about rolling back their tax cuts for the top one percent. Until then, every time they mention the deficit or the debt it’s merely a pretense to grab more cash out of your wallet to fund their third yachts and fourth mansions.