In the entry on structural and cyclical deficits on the Business site, a commenter says:
Megan opens with "Liberals are focusing on the cyclical deficit, which is not a big problem. Conservatives are talking about the structural deficit, which is a huge problem." She then contradicts herself when she cites Paul Krugman while discussing the structural deficit: "it
isn't true that the structural deficit is not a problem if we just leave it alone. Paul Krugman and others have been posting graphs like this one:"
And this bizarre observation: our structural deficits can be blamed on LBJ and FDR??? I assume that's because they created Social Security and Medicare. That's a bold statement to make, given that the cause of our structural deficit is complex. Even before breaking the surface, one must recognize that deficits are not caused by spending alone, they are caused by revenues that are lower than spending. Hence, one could just as easily blame Ronal Reagan for the structural deficit because he reduced revenues (while substantially increasing defense spending).Megan has written some insightful posts before. Unfortunately, this is not one of them. My advice: steer clear of the political hackery and focus on the data.
First, I take Paul Krugman to be mostly writing about the cyclical deficit; he is worried that we will not do enough, now, to stimulate employment.
On the broader point, several things: First, Medicare and Social Security are, simply unquestionably, the runaway problems with our budget. You could zero out the defense budget, and it wouldn't pay for a year of Social Security by 2014. Second, Medicare and Social Security nominally come attached to a source of revenue, which starting this decade will be insufficient to cover their outflow.