What Trillion Dollar Deficit?

Aug 9 2013 @ 1:57pm

Budget Deficit

The part of Josh Green’s interview with Rand Paul that’s getting the most attention:

You know, the thing is, people want to say [my budget is] extreme. But what I would say is extreme is a trillion-dollar deficit every year. I mean, that’s an extremely bad situation.

Waldman counters with the above chart:

Actually, according to the latest Congressional Budget Office (CBO) figures, the deficit for 2013 will be $642 billion. That’s a lot of money to you and me, but it isn’t a trillion dollars, and it’s the lowest deficit since 2008. The CBO is also projecting that in 2014 the deficit will fall to $560 billion, and in 2015 it will fall further, to $378 billion.

Those projections will inevitably be revised over time. Maybe the deficit will actually be larger, or maybe it will be smaller. One thing we can say for sure though, is that for the moment at least, there are no more “trillion-dollar deficits,” not every year, and not any year. In fact, the reduction of the deficit over Barack Obama’s term has been nothing short of stunning.

Chait is unsurprised by Paul’s ignorance:

For Rand (and Ron) Paul, the dread specter of fiscal collapse and hyperinflation is more of a generalized fact of life than something that depends on particular “numbers.” The whole political rise of the Pauls since 2008 owes a great deal to the economic crisis and the resulting spike in the deficit, which drove large numbers of people to join the freak-out bunker where the Pauls have resided all along. Of course Rand Paul isn’t going to notice the apocalypse is receding — its imminent appearance is a fixed piece of his worldview.

Krugman wonders what the public believes:

Larry Bartels likes to cite a 1996 poll in which voters were asked whether the deficit had increased or decreased under Clinton (it had, in fact, fallen sharply). A plurality of voters — and a heavy majority of Republicans — thought the deficit had gone up.

So I’d love to see a comparable poll now — asking, say, what has happened to the deficit since 2009. (It has actually been cut more than 50 percent). My bet is that it would look like that 1996 poll.