Apparently, U.S. politics are now so polarized, rational conversation about the federal budget is no longer possible. Last week, the House of Representatives approved a two-year budget deal that stands to boost spending by $320 billion, significantly expanding the deficit. Yet commentators have not been able to articulate a coherent response — no matter which political side they’re on.
Democrats seem not to recognize that the spendthrift budget is similar to the kind of fiscal policy they were recommending before Trump’s election. The common claim, voiced by partisans from Lawrence Summers to Paul Krugman, was that the economy had entered a new era of long-term “secular stagnation” and deficient demand. Left-leaning economists called for more government spending and higher budget deficits, and that is what we are getting now, albeit with a suboptimal level of infrastructure spending.