I’m wondering if it’s the New York Times and not the Washington Post with the content-sharing agreement with Pete Peterson’s deficit-hyping “Fiscal Times.” Because the Grey Lady’s output over the past 24 hours has been curiously tilted toward deficit mania.
First, there’s the front-page story today from Jackie Calmes, which makes the logical leap from partisan gridlock automatically into a deficit crisis, not a jobs crisis or a health care crisis or a climate crisis, all of them also candidates for being casualties of the inability for the legislative branch to govern:
Senator Evan Bayh’s comments this week about a dysfunctional Congress reflected a complaint being directed at Washington with increasing frequency, and there is broad agreement among critics about Exhibit A: The unwillingness of the two parties to compromise to control a national debt that is rising to dangerous heights.
After decades of warnings that budgetary profligacy, escalating health care costs and an aging population would lead to a day of fiscal reckoning, economists and the nation’s foreign creditors say that moment is approaching faster than expected, hastened by a deep recession that cost trillions of dollars in lost tax revenues and higher spending for safety-net programs.
Yet rarely has the political system seemed more polarized and less able to solve big problems that involve trust, tough choices and little short-term gain. The main urgency for both parties seems to be about pinning blame on the other, before November’s elections, for deficits now averaging $1 trillion a year, the largest since World War II relative to the size of the economy.
This is apparently a news story, though I see precious little news and a hell of a lot of editorial opinion. Again, the idea that partisan gridlock is only responsible for allowing deficits to expand, not soaring ranks of the jobless and uninsured or a boiling planet or any of the 1,000 other crises locked into place by the filibuster, is not only nonsensical, but reflective of a real agenda.
Allow me to name the only sources of quotes in Calmes’ article:
G. William Hoagland, a former fiscal policy adviser to Senate Republicans; Alan Simpson, the former Republican Congressman and co-chair of this new Presidential deficit commission; Alan J. Auerbach, an economist.
Sounds like a balanced panel of experts. And it wasn’t until the very, very end of the story that Calmes noted recent polling from the NYT and CBS showing that voters would much rather cut military spending than health care or education.
Later on in the day, The Times uncorked this story about Federal Reserve officials talking about the deficit:
Though only a minority so far, the officials are warning that a failure to bring the budget under control could lead to a dangerous spiral of inflation. Worries about the possible long-term effects of the deficit have galvanized political debate in recent days, culminating in President Obama’s decision to create a bipartisan commission to tame the nation’s debt.
The comments by Fed officials reflect, in part, a concern about the central bank’s ability to maintain its political independence over the long term, a concern shared by the Fed chairman, Ben S. Bernanke. Next week, Mr. Bernanke is set to deliver the Fed’s semiannual monetary report to Congress, and economists will be watching closely to see if he too says anything about the debt and the deficit.
Thomas M. Hoenig, president of the Federal Reserve Bank of Kansas City since 1991 and the longest-serving of the 12 Fed bank presidents, warned on Tuesday that in the worst case, the Fed could face pressure to inflate the nation’s way out of its indebtedness.
“It seems inevitable that a government turns to its central bank to bridge budget shortfalls, with the result being too-rapid money creation and eventually, not immediately, high inflation,” he said at a policy forum here, sponsored by the Peterson-Pew Commission on Budget Reform. “Such outcomes require either a cooperative central bank or an infringement on its independence.”
This is actually a story, if for no other reason than Fed bank Presidents talking about fiscal policy is unusual (and also beyond their mandate, but that’s another matter). But Thomas Hoenig has made a multitude of notable comments over the last year, like openly advocating for restoring Glass-Steagall and resolution authority for “too big to fail” banks. Yet the Times, based on a cursory search, has never seen fit to put these opinions in print, and the only time they get mentioned are in blog posts on its site by Simon Johnson or Paul Krugman.
It’s a matter of emphasis. And story after story about the “out-of-control debt,” which is not that out of control, tend to give an impression to the public that they are the biggest problem facing the nation. But the 10 million-odd unemployed Americans would beg to differ. And trusted media outlets favoring the concerns of deficit scolds over those jobless do a disservice to the nation.