Flashback

A 9 June, 2004 article from The Washington Post, which focuses primarily on interest rates, reminds us that the current economic crisis did not come out of the blue:

In late 2002, Cheney had summoned the Bush administration's economic team to his office to discuss another round of tax cuts to stimulate the economy. Then-Treasury Secretary Paul H. O'Neill pleaded that the government -- already running a $158 billion deficit -- was careering toward a fiscal crisis. But by O'Neill's account of the meeting, Cheney silenced him by invoking his take on Reagan's legacy [allegedly, "Reagan proved deficits don't matter"].

It wasn't that Reagan's policies proved that government borrowing had no impact on the economy. But his administration's record -- particularly with some years of hindsight -- did give reason to question traditional thinking and provided a new context for future arguments about deficit spending.

"The lesson we should have learned [from those years] is that deficits have little or no short-term economic impacts," said William A. Niskanen, a member of Reagan's Council of Economic Advisers. (WaPo)

Interesting reading, but it seems that "them in charge" didn't pay attention to the "short-term impact" qualifier; by the time of the article's publication, we'd racked up $1.7 trillion in debt. This amount, Niskanen said, "has made the country "terribly dependent" and "terribly vulnerable." Indeed. But who were "them in charge" approving the debt? And who was talking about "mortgaging our children's futures" then?