Last week I discussed, Deficit’s Down and So Are Debt Scolds. It was about how the CBO looked at the 2014 budget deficit and found that it will be $200 billion less than predicted. And this is after the predicted value was down from previous years. So all those groups who exist to foment hysteria about the budget deficit are happy. Just kidding! In as much as it gets their attention at all, it has been only to claim that they were only concerned about long-term budgets and of course they were for short-term stimulus.
Friday, the Committee for a Responsible Federal Budget (CRFB) put out an apologia, The Concern Has Always Been Long-Term Deficits. The nicest thing you can say about it is that it is disingenuous. It contains six quotes from previous CRFB documents. The first, from January of 2008, reads:
That’s a highly selective quote. It is from a document, CBO Baseline: the Deficit Is Growing Again. The quotation above is not in the main document, it is in what is effectively a footnote. It is also a misquote. It is not a full sentence. The full sentence is this:
So really what they are saying is, “Okay, maybe stimulus is okay. But generally it is not. If you don’t do it our way, you shouldn’t do anything.” And the bottom line is that what is most important is, “Budget deficit!” The comment does link to a document (doc) that is pretty clear headed — at least it admits that you can’t have stimulus if the government pays for it. But this is a pretty low bar.
The next quotation comes from, CBO’s Analysis of the President’s FY2010 Budget Blueprint (pdf):
As Jonathan Chait has pointed out, whether short-term stimulus is necessary is open to debate (“may”), but there is absolutely no doubt (“cannot”) that there must be something done about the long-term deficit. This is the case with all the quotes. They provide lip service to the need for short-term stimulus, but they are metaphorically shouting about the deficit.
For example, the last quote is from a five page document and it shows up in the second to last paragraph. And even in that paragraph, it is sandwiched between “budget paints a dismal fiscal picture” and “threaten long-term economic growth and impair the normal functions and flexibility of government.” Even more important, they don’t believe that short-term stimulus is okay to get the economy moving again, it is all about stabilizing the economy. The last paragraph starts, “The latest projections underline the need for the Administration to put forward a plan for reducing the deficit as soon as the economy has stabilized.” So as soon as the economy is not in free-fall, there should be austerity. By this logic, we should have cut back in June of 2009. As it was, we waited a bit past that time.
All the rest of the quotes are of the same kind. And they are all small caveats at the end of longer documents. Even in January of 2012, after the federal government approved the sequester and increased taxes on the wealthy, they were ranting about the budget deficit. The caveats were put into the documents for exactly the reason they are being used now: to allow them to claim that they were never against short-term stimulus even though they were.
Notice also that the sequence of quotes itself is telling. It starts in January of 2008 and goes through February of 2014. That’s seven years of projections. Are we still in the “short-term” and “stabilization” phases of this recession? Each one of these CBO analyses say the same thing, “Be afraid; be very afraid! Oh, and short-term stimulus might be okay.” But as Chait pointed out:
Another thing to note is that their focus was not on long-term deficits. It was on deficits generally. In their 2009 document, they mention the word “deficit” 26 times but only modify it three times. The best word to describe this is disingenuous. It’s true that the CRFB has always said that their concern was the long-term deficit, but their overall message was just that deficits were bad — now and always. I remember seeing representatives of the group interviewed in which they admitted that short-term deficits might be necessary to stabilize the economy and that their real concern was the long-term deficit. But these were the quiet moments. These were 30 seconds at the end of a half-hour during which they ranted about the coming catastrophe of budget deficits. What I never heard and is not contained in any of the documents they quote is the idea that the best way to deal with our long-term deficit is to have a strong economy. And their attitude about short-term stimulus was always as a frustrated mother teller her young son that he can play video games for five more minutes but then he must clean his room because that is very important. Their support for short-term economic measures was a concession — an unfortunate one that got in the way of their real agenda, which is entitlement cuts and fiscally neutral (Ha!) income tax rate cuts.