If you've been paying attention this past decade, it won't surprise
you to learn that the country's policy elites are in the midst of a
destructive, well-nigh unhinged discussion about the future of the
nation. But even by the degraded standards of the Washington
establishment, the growing panic over government debt is shocking.
First, the facts. Nearly the entire deficit for this year and those
projected into the near and medium terms are the result of three
things: the ongoing wars in Afghanistan and Iraq, the Bush tax cuts
and the recession. The solution to our fiscal situation is: end the
wars, allow the tax cuts to expire and restore robust growth. Our
long-term structural deficits will require us to control healthcare
inflation the way countries with single-payer systems do.
But right now we face a joblessness crisis that threatens to pitch us
into a long, ugly period of low growth, the kind of lost decade that
will cause tremendous misery, degrade the nation's human capital,
undermine an entire cohort of young workers for years and blow a hole
in the government's bank sheet. The best chance we have to stave off
this scenario is more government spending to nurse the economy back to
health. The economy may be alive, but that doesn't mean it's healthy.
There's a reason you keep taking antibiotics even after you start to