About That Deficit problem?

It’s gone….

Raise your hands if you remember the issue….

So what happened? Simple answer, of course, is that the deficit is way down and, for now, no longer a big problem.

This week’s Congressional Budget Office (CBO) estimate for the fiscal 2014 deficit is $492 billion, or 2.8 percent of gross domestic product, which is pretty much where it was back in the early part of the Bush II administration –though it’s expected to rise sharply in coming years.

No one is really working the issue very hard on the stump, patting themselves on the back, talking about the wonderful Bipartisan Budget Act of 2013. (Okay, maybe that wasn’t a big deal and only passed because neither party cared all that much any more.)

While President Obama has talked about the dramatic reduction in the deficit, “most Democrats never thought the deficit was the right issue on which to focus,” said Brookings Institution senior fellow and Clinton administration policy adviser Bill Galston. “They were very critical of the attention Obama gave it during 2011,” he told the Loop, so they’re not that interested in bragging about the progress.

Tea Party Republicans, Galston noted, have “an enormous investment in the proposition that ‘spending’ remains out of control and fear that acknowledging the lower deficit would reduce the power of their narrative.”

And maybe the GOP base has plenty of other things to rally around: a most unpopular president, Benghazi or House Speaker John Boehner‘s lawsuit against Obama for failing to enforce parts of Obamacare.

The real problem, Douglas Holtz-Eakin, former CBO director and top economic policy adviser to Sen. John McCain‘s 2008 presidential campaign, tells us, is that: “Congratulations are due to American workers, entrepreneurs and families for their work toward economy recovery that has reduced the deficit.

Collectively, Washington has done essentially nothing, unless you count stopping making it worse.”

More….

Note….

I have always pointed out that countries run deficits and they do NOT really matter….

They just come and go on their own…

I Rest My Case….

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2 Comments.

  1. My Name Is jack

    In my view,the deficit remains a long term problem.

    I agree that it continues to fluctuate ,but even this somewhat optimistic CBO report notes that it is predicted to “rise sharply in the future.

    I do not think that the present “good news” on the deficit should be used as an excuse to not address the structural problems with Social Security and Medicare which are not going away.

  2. I have pointed out that counties
    Unlike corporations or you and me run deficits ALL THE TIME
    Balanced budgets on count in their bond ratings
    Countries HAVE to just honor their paper
    Which they can print more of anytime
    Their are constand up and downs in most economies
    That almost always straighten themselves out
    On their own with some action by the country
    By NO MEANS should countries spent and print recklessly though