Paul Krugman, "Dwindling Deficit Disorder": The Sinking of the Titanic

In his latest New York Times op-ed entitled "Dwindling Deficit Disorder" (http://www.nytimes.com/2013/03/11/opinion/krugman-dwindling-deficit-disorder.html?_r=0), Paul Krugman concludes:

"The deficit is indeed dwindling, and the case for making the deficit a central policy concern, which was never very strong given low borrowing costs and high unemployment, has now completely vanished."

But what if unemployment remains high? As acknowledged by Krugman, "unemployment, especially long-term unemployment, is still unacceptably high." My guess is that high unemployment is with us to stay, given that US manufacturing has been allowed to fly the coop.

And what if borrowing rates go higher? They will need to be adjusted higher when there is a resurgence of inflation sometime over the next 28 years.

Why 28 years? Because as observed by Paul in an earlier op-ed (http://www.nytimes.com/2012/12/17/opinion/krugman-that-terrible-trillion.html?_r=0), the ratio of debt to G.D.P. is "the best measure of our debt position."

Well, US debt is currently some $16.7 trillion, which is more that 100% of America's G.D.P. Those "fools" at the nonpartisan Congressional Budget Office recently warned that "U.S. debt is on track to be nearly twice the size of the U.S. economy by 2037" (http://thehill.com/blogs/on-the-money/budget/230901-cbo-warns-of-grim-long-term-debt-outlook). Sure, in the meantime the American Taxpayer Relief Act and the sequester may have delayed "achievement" of that 200% debt to G.D.P. ratio by a few years; however, as acknowledged by the Peterson Foundation (http://www.pgpf.org/Issues/Fiscal-Outlook/2013/01/fiscal-cliff-atra-2012-long-term-analysis.aspx), we're still headed for that astronomical percentage by 2040.

Krugman warns of "scare tactics" and "a blizzard of bogus numbers" coming from those who oppose his calls for higher federal spending. "Bogus numbers" from the CBO? I don't think so. "Scare tactics"? Scared, me? The damage done and still to be done by the Obama administration is irreversible, and I am prepared to meet my maker.

Yes, the Titanic is going down as Krugman cries "All is well," and it will be for future generations to send deep-sea probes down into the cold murky water to conduct a proper postmortem.