Krugman on "Dwindling Deficit Disorder"

It's a disorder rampant on the editorial pages of the once great Washington Post Kaplan Daily and on Sunday talk shows:

"For three years and more, policy debate in Washington has been dominated by warnings about the dangers of budget deficits. A few lonely economists have tried from the beginning to point out that this fixation is all wrong, that deficit spending is actually appropriate in a depressed economy. But even though the deficit scolds have been wrong about everything so far — where are the soaring interest rates we were promised? — protests that we are having the wrong conversation have consistently fallen on deaf ears.

"What’s really remarkable at this point, however, is the persistence of the deficit fixation in the face of rapidly changing facts. People still talk as if the deficit were exploding, as if the United States budget were on an unsustainable path; in fact, the deficit is falling more rapidly than it has for generations, it is already down to sustainable levels, and it is too small given the state of the economy."  (our emphasis)

The whole article is, of course, worth reading -- and remembering the next time you hear a charlatan (=cough=Pete Peterson=cough=) earnestly entreating us to "fix the debt."