When Will Glenn Kessler Question the Counterfactuals of the Deficit Hawks?
|Tuesday, 12 March 2013 08:35|
Glenn Kessler has been doing a good job scrutinizing the claims of horrors of sequester in his job as the Washington Post fact checker. For example, in this piece on the Obama administration's claim of the number of children who would be denied vaccines because of the sequester, he questions how many otherwise would have gotten vaccines and whether there were sources of flexibility in the program's funding that would allow vaccines to continue to be offered to eligible children.
These are reasonable points to raise. They imply that steps can be taken to prevent the sequester from being as harmful as simple across the board cuts may first appear.
In fact, this is a reasonable way to assess any claim about budgets. Unfortunately this critical approach does not get applied to standard framework in which Washington budget debates are taking place.
This framework holds that we must commit the country now to achieving some debt target (e.g. 73 percent of GDP) as of 2023, with the country then on a stable path of a debt to GDP ratio, or something really bad will happen. The implicit counter-factual in this framework is that even as the budget situation deteriorates later in this decade and early in the next decade, and financial markets get ever more antsy demanding ever higher interest rates, Congress does nothing.
This has never happened in U.S. history. There has never been a prolonged stretch in which the budget situation has deteriorated without a response from Congress. Nor have the financial markets ever panicked to the point where the government had any difficulty selling its debt.
In other words, the horror stories of exploding deficits and debt and resulting financial market panic have no historical precedent. They assume that future congresses will be far more irresponsible that any we have seen in the past.
This is of course possible, but it is a very strong assumption. It certainly would be worth pointing out to readers. Many Post readers have probably been led to believe that if the country does not do something about its deficit now there will be a problem as opposed to a situation where the deficit begins to pose major problems over the next decade and Congress still doesn't do anything. This confusion is far more important to current policy debates than the exact number of vaccines that will not be given due to the sequester.