If You Read One 'Serious' Newspaper Article This Weekend: please let it be this one, by Jackie Calmes in today's New York Times, about the economic and political consequences of the House GOP's anti-deficit push.
Read it all, but the short version is: Since winning control of the House, the Republican leadership has been brilliantly successful in convincing some of the public, enough of the news media, and at crucial points the Obama Administration that the main threat to America is future deficits. Thus the debt-ceiling collision; thus the agreed-on cutbacks; thus the frenzy through these past few months about deficit projections.
Meanwhile, what business people, ratings agencies, financiers, investors, central bankers, and even most Republican economists (with a predictable exception) consider the real emergencies for the country -- stagnant growth, very high unemployment, the prospect of worldwide recession yet again, which among other bad effects would drive deficits even higher -- will only get worse because of the new austerity drive. These officials are all trying to wave the GOP leaders off their commitment, but the politicians don't notice, don't care, or don't grasp the point. Thus the deathless words of Rep. Eric Cantor, from a memo to his troops as reported by the NYT:
"Over the next several months, there will be tremendous pressure on Congress to prove that S.& P.'s analysis of the inability of the political parties to bridge our differences is wrong. In short, there will be pressure to compromise on tax increases," Mr. Cantor wrote.
.But, he added, "We were not elected to raise taxes or take more money out of the pockets of hardworking families and business people."
Translated: S&P downgraded U.S. debt because they concluded U.S. government was dysfunctional. There will be pressure to prove them wrong. Let's prove them right! Even though that leads to higher deficits. Even though that leaves people out of jobs. You can't make this up. Anyhow, please read it sometime this weekend.