Briefly, the fix the debt chorus isn’t really freaked out of the current debt, which…
would pose essentially zero threat to the country’s fiscal health, as the ongoing growth of the economy would send our debt-to-GDP ratio dropping like a rock.
What they’re so hot and bothered about is the supposed debt coming in the future as entitlements are predicted to explode with the retirement of the baby boomers. HOWEVER, trying to predict budgets for 20 or 30 years from now is a precarious, if not silly exercise.
Imagine trying to model the 2011 economy in 1985. Things you’d never see coming include (among other things) the Internet, fracking, massive advances in computing power, the renewable energy boom, three wars, a massive recession, and Harry Potter. And predictions can be hard even over shorter time frames. In 1995, CBO predicted the deficit in 2000 would be well over $200 billion. We ran a surplus of $236 billion.
Which makes it doubly puzzling that anybody is demanding to balance the budget now (right now, yesterday!), in the midst of a weak recovery to a huge recession and fighting with Paul Krugman as to whether we wouldn’t be very much better off by spending more now to create jobs and raise some taxes on the wealthy and grow our way to balance rather than fruitless austerity. The more the fix the debt people yell and seem to purposely misunderstand and misrepresent how the economy works, the more you have to wonder what their real agenda is.
Refusing to tackle that all-too-real crisis with the full range of economic resources at our disposal is a shameful moral and political failure. Especially when the reason we’re refusing is fear of shadows cast on the wall.