The freak show has come to staid, pedestrian Delaware, in the form of Christine O’Donnell and her litany of crazy. But while the national media and late-night comics focus on condoms, masturbation and witchcraft, the man who is likely to become the next Senator from the state has quietly gone about his business. I had the opportunity to talk with Coons about the race, the O’Donnell madness, and his specific positions on issues he could face shortly in the Senate.

Ben Nelson has come out for extending all the Bush tax cuts “until Nebraska’s and the nation’s economy is in better shape, and perhaps longer, because raising taxes in a weak economy could impair recovery.” It’s funny that he throws Nebraska in there, which is sitting on 5%. It’s also funny that he calls the extension an action “to help the economy” like the stimulus package in 2009, even though this would merely be an extension of current tax rates, which aren’t boosting the economy in any way.

The CBO released their budget estimates for the next ten years today, under current law. It shows that this year’s deficit is estimated at $1.342 trillion dollars, certainly a very high number and almost entirely attributable to the low tax receipts and high automatic stabilizers of the Great Recession. But by 2014, the deficit actually shrinks by well over 60%, to $438 billion dollars, before gradually increasing again. That 2014 deficit is just 2.5% of GDP.

The operative word here is “current law.” Because that assumes a whole host of tax cuts will expire and revert back to their previous state. It also assumes that Congress will not meddle and change those tax laws. If they do what is expected, just for the year 2014, they will double the federal deficit.

It’s summer in an election year, and that’s the time for the deficit peacocks to come out of hibernation and strut their feathers, letting everyone know that they care – very much! – about deficits. This is a bipartisan phenomenon. On one side of the aisle, Republicans want to freeze discretionary spending, borrowing an idea from the other side of the aisle, from Claire McCaskill (D-MO). She at least tried to sound reasonably sane, but the impact of her preferred policy would be pretty negative.

President Obama’s deficit commission, lovingly described around these parts as the cat food commission. It lived up to its name yesterday, as Bowles and Simpson described the budget as “a cancer that will destroy the country from within.” It’s one of those curious cancers which would go completely away if Congress simply did nothing. But this cancer must be fought, we’re told, by making sure retirees have no financial security.

I don’t know that you could make a blanket statement anymore that the economic advisers know best – economic advisers have made a habit of letting the nation down these days – but in a contest between the economic team and the political team, I’ll take the economic team most of the time. The public doesn’t rely on economic theory to shape their opinions, they rely on results. They can be told that deficits drove the recession or some other pabulum, but the greatest antidote to this fearmongering would be tangible improvements in their economic picture.

Progressive Democrats issued a challenge this morning to their colleagues in the House on the eve of a scheduled vote on the war supplemental: the only fiscally responsible stance is to end the emergency funding.

In an announcement that portends misery for much of the world’s citizens (and I’m only slightly exaggerating), the G20 communique will include a pledge from the largest nations on Earth to halve their budget deficits by 2013. Coming at a fragile time for the global economy, this descent into austerity could lead to a return to recession or worse.

The New York Times cites an anonymous source saying that Peter Orszag will step down as the head of the Office of Management and Budget.

The G-20 nations over the weekend basically held up a “Let Them Eat Cake” sign for the rest of the planet’s citizens to read. And a white flag to the bond market vigilantes, to boot. Not in this country or abroad has the private sector stepped up to drive the recovery. And yet, the deficit scolds have won. There will be no more fiscal stimulus, generally speaking, for most of the world. And that’s true despite mass unemployment in America and rising joblessness in Europe. This is precisely the kind of thinking that turned a jarring stock market crash into a worldwide depression in the 1930s.