Leading A Nation With a Deficit

The recent appearance of Senator Paul Tsongas at the Kennedy School was the occasion for an hour-long session of self-congratulation. Sponsored by Lead or Leave, the student organization dedicated to lobbying to reduce the national debt, the panel featuring Tsongas and other Massachusetts politicians had a clear message: the deficit is leading us to social collapse. Only by reducing the deficit to zero in the next seven years can we hope to save ourselves.

There was much back-slapping and grave head-shaking, as questioners and panelists announced how concerned they were, how much they had done for the cause, and how incredible it was that everybody else couldn't see what was so plainly necessary.

As is usual with discussions of the deficit, the exact way that this financial Apocalypse will come to pass was skipped over. Instead, the wonderful new term "intergenerational morality" was used, in solemn tones, to describe the moral crime implicit in deficit spending.

In conjunction with "youth tax," the righteously indignant slogan of Lead or Leave, "intergenerational morality" attempts to shame voters into making deficit reduction the nation's top priority. It suggests, vaguely, that the debt will come crashing down on the heads of today's children.

It is true that our budget deficit deserves attention. But Tsongas, Warren Rudman and their Concord Coalition use rhetoric that suggests that it is wrong by its very nature. In fact, borrowing money in order to spend it is morally neutral. Our judgment of such borrowing should depend on what it is used for; there can be good and bad deficits. But deficit spending in and of itself can be useful and should not be shamed out of the political debate.

The debate over deficit reduction often ignores an important point: the role of government is to improve the lives of its citizens. If deficit spending achieves this goal, it is wholly positive. By making the country stronger, it guarantees our ability to sustain the debt load. During World War II, for example, the nation carried a higher percentage of debt than it does now. Nobody cried "youth tax" then because the borrowing was for a good cause.

What is wrong is borrowing to finance shortsighted tax cuts and a useless military establishment, which is how our current $4 trillion debt was created. These expenses created no long-term sources of wealth or improvements in public welfare. Instead, they subsidized unproductive defense jobs and massaged the middle class into voting Republican. This wasteful expense sustained an artificial prosperity while allowing serious problems, like urban decay and inadequate medical coverage, to go unresolved. It was, in fact, the cause of our current economic problems.

But the specific qualities of the current deficit are extended by fiscal conservatives like Tsongas and company to apply to deficit spending in general. They are using it as a political weapon to create a permanent fear of spending. Long after the deficit is reduced, the specter of overspending will haunt national debate. Aggressive, ambitious new spending will always have to contest with the ghost of "intergenerational morality".

In the face of this underhanded threat to the premise of liberal government, it is imperative that a case be made for spending. In the next decade, America will desperately need to spend money to solve our social problems.

Urban poverty alone will require a giant commitment of money if it is to be stopped from turning all our cities into violent slums. Public resources will have to be mobilized against the spread of AIDS and other communicable diseases. Insuring adequate medical care for the entire population will require a lot of money.

If we go into this era of new and expensive social problems with the idea burned into our brain that the government must not run a deficit, we will be unable to meet these challenges. We must look at deficit spending as a tool, like any other tool the government possesses.

When used to help people, spending is good; when used to support waste and militarism, it is bad. We should reduce our current deficit, insofar as it is caused by defense spending, unnecessary entitlements for wealthy retirees, and corrupt subsidies. But we should be prepared to spend that much and more to solve the problems that lie ahead.

The government's primary goal is not to stay in the black. Nobody could argue with the proposition that we should spend only what is necessary. But we must be prepared to acknowledge that what is necessary will be very, very expensive.