Bad Moon Arising

Max B. Sawicky
August 25, 2005

Max B. Sawicky is an economist at the Economic Policy Institute. He can be reached at his blog, MaxSpeak, You Listen!

While last week we were distracted by some euphoric fluff about this year's budget deficit, serious problems are brewing. The U.S. economy is facing two giant imbalances: the projected gap between tax revenues and federal spending, and the current, growing gap between what the U.S. buys and what it sells to the rest of the world. The measure of our political system's vacuity, fed by a brainless commercial media, is the inability or unwillingness to put these issues on the table. Consequently, when forced to deal with a crisis, the remedies are likely to be short-sighted, panicky and stupid.

In light of the interesting times that lie ahead, whatever happens to the 2005 or 2006 deficit is not even a sideshow; it's a flea circus.