The take-away from Obama’s presser is that budget hawks can take a long vacation because they won’t be relevant for a while. I expect most Republicans and Blue Dog Democrats to huff and puff about this, but there is a wide ideological consensus in favor of a major stimulus package that comes without offsetting increases in revenues. Basically, we are going to ask foreign banks to flood the zone with cash and we’ll pay it back later. This is one more reason for our children and grandchildren to hate us. Yet, we’ve arrived at this moment and what can we do?
I feel much better about deficit spending that is aimed at creating jobs than in deficit spending that is aimed at killing Arabs. But we need to raise marginal tax rates at the top to help offset some of this insane borrowing. It’s a matter of generational equity.
