I can see why progressive Democrats are reassured by Obama's speech on deficits and debt. Paul Krugman says that he can live with the president's promises to defend the welfare state and stick it to the rich. He grades the speech on style (please stop saying, "win the future": good advice) and then on substance.

Substance: Much better than many of us feared. Hardly any Bowles-Simpson -- yay!

EJ Dionne is also delighted that the president is leading once again. A speech worthy of a president.

[T]he president was unequivocal in arguing that the roots of our fiscal problems lie in the tax cuts of the past decade that we could not afford. And he raised the stakes in our politics to something more fundamental than dry numbers on a page or computer screen.

Yes, those dry numbers are such a bore. Now, as I say, Democrats are quite right to be encouraged by Obama's speech, if the main thing is to oppose the Republican agenda more effectively. Of course that is the main thing, in their view and, believe me, I do see the case for making it the top priority. But suppose, just humor me for a second, that the main thing is to get borrowing under control--to reassure the markets, rather than Krugman, Dionne, and the Democratic base. Then the picture is less encouraging. "Hardly any Bowles-Simpson. Yay."

And I am far from reassured when I read of Tim Geithner telling the FT that the US, contrary to the accurate assessments of Krugman and Dionne, has made a "fundamental shift" towards fiscal discipline.

"When you have both the president of the United States and the Republican leadership in Congress both embracing the same basic target for deficit reduction ... you have made the fundamental shift that makes it very hard for future presidents, future congresses to decide that you can live with the risks of higher deficits in the future," Mr Geithner said on Thursday.

I had to read that three times. Makes it very hard for future presidents and Congresses? What about this president and this Congress, for heaven's sake? Do they not have some role?

A politely sceptical Gillian Tett reports that "seasoned heads" in the White House look at it this way:

[T]here are now three crucial variables to watch: first, the "acknowledgement" issue (namely whether politicians recognise the fiscal problem); secondly, the "process" question (whether there is a constructive debate); and thirdly, the "plan" (namely whether there are credible proposals on the table). If two out of three of these items are on the checklist, the argument goes, investors will remain reassured. If not, trouble looms.

Two out of three will do? Would that be any two? You never need an actual plan, so long as you have acknowledgment and "constructive debate"? One trembles at the power of this insight. If true, it would vindicate Washington's overarching view of the world. But I think your head would need to be very seasoned indeed, seasoned nearly to the point of mental illness, to believe it.