He hopes the administration will drop Social Security cuts because their decision was based on false data. However, the reason they won't is revealed right up front in his own article.
"I asked why they wanted these cuts. Because the international markets want them, was the reply. But the international bond markets love US government debt right now, I said."
Bond markets are the "smart money" and they bake debt growth into the cake. Clearly Geithner was not talking about what "international markets" wanted. He was talking about what somebody else wanted and Eskow knew that. Who was that "somebody else"?
Another clue he mentions himself is an older piece titled "147 people" that describes the cloistered thinking among banker technocrats and decision makers that are also commonly recognized as "the very serious people". We're talking about monumental egos and vast piles of cash at stake and they are not going to change their world view because Reinhart/Rogoff was proved bogus.
http://blog.ourfuture.org/20130325/147-people
There is a whole industry now willing and able to fabricate a brand new case backing up the same concept of keeping taxes historically low at the top and pay for it by defaulting on promises to future Social Security recipients.
So, going back to my first point. The Reinhart/Rogoff paper was not an accident or an error. The central of point is supported by the errors. No tin foil hats required.
Herndon, Ash and Pollin are heroes. They beat back the flawed conventional wisdom as well as the cynical bad guys by scrutinizing the data and calling out the lies. Nobody can fight the Pete Peterson's or the David Koch's with money. You have to out-think them and be vigilant and that's exactly what happened here.
Whatever you do just don't think this is over because they are going to keep on coming.
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