Hysteria over the deficit

To me — and I’m not alone in this — the sudden outbreak of deficit hysteria brings back memories of the groupthink that took hold during the run-up to the Iraq war. Now, as then, dubious allegations, not backed by hard evidence, are being reported as if they have been established beyond a shadow of a doubt. Now, as then, much of the political and media establishments have bought into the notion that we must take drastic action quickly, even though there hasn’t been any new information to justify this sudden urgency. Now, as then, those who challenge the prevailing narrative, no matter how strong their case and no matter how solid their background, are being marginalized.

Paul Krugman – Fiscal Scare Tactics

Oh, and here’s a good piece on how the housing bubble got started in the first place.  Right-wingers are not wrong to say that Fannie Mae & Freddie Mac and other liberal institutions are part of the problem that led to the bubble, but they’re wrong to say that they’re the only reasons. The bubble was a broad-based one that had more complex causes.

Update: What are the real problems that America should be working on?  Excellent column by Bob Herbert of the NY Times:

We don’t hear a lot that is serious about the sorry state of the nation’s infrastructure or the trade policies that crippled so many American industries or our inability (or unwillingness) to compete effectively with China when it comes to the new world of energy for the 21st century or our abject failure to provide a quality public education for the next generation of American workers, scientists, artists and entrepreneurs.

Much more at the link.

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