Dean Baker: The Deficit Crisis Mongers Go Off the Deep End [View all]

[eridani]

http://www.nationofchange.org/deficit-crisis-mongers-go-deep-end-1353168534

However, the deficit crisis mongers are a persistent bunch. If they can’t make a case based on economics, they turn to their good friend the confidence fairy. The story presented to us in a column in the Washington Post was that business people will get freaked out if there is no deal by January 1 and that financial markets will panic. New York Times columnist David Brooks pushed the same line in a column earlier in the week.

This sort of warning, coming from people who have a near-perfect track record in being wrong on everything they say about the economy, would ordinarily be laughable. Unfortunately, these warnings come from people who have prominent positions in national policy debates. Therefore it is likely that such warnings will be taken seriously.

The deficit hawks want to promote a sense of crisis because it is essential to advancing their agenda. If the January 1 deadline passes, the political ground shifts to those who just want to see an end to the Bush tax cuts for the wealthy. After January 1, the Bush tax cuts will have expired.