“Deficits don’t matter.”
Former Vice President Dick Cheney made that observation while he was in office, and his administration was racking up annual deficits of hundreds of billions of dollars.
Cheney, of course, was as wrong about deficits as he was about weapons of mass destruction in Iraq. The piling on of federal debt, year after year, takes an increasing toll.
That’s more true today than ever, with Washington trying to jump start the economy out of its steep recession.
The success of this spending binge — which has been the handiwork of the Obama administration, although its origins can be traced to the dying days of the Bush administration — is mixed. For one thing, it’s impossible to say with any certainty how bad things would have gotten if no steps had been taken to stimulate the economy or bail out key industries.
Some analysts argue that the country could have suffered another massive economic depression, but there’s no way to prove that.
Conversely, other economists worry that Washington’s efforts may have had a short-term impact, but pose serious risks for the future. Not only have the bailouts and related actions skewed the free market system, ballooning federal deficits are running at levels far beyond anything ever seen before.
For the fiscal year that ended Sept. 30, the annual deficit was $1.42 trillion — three times higher than the previous year’s record amount. And the Obama administration anticipates deficits averaging close to $1 trillion per year for the next decade.
Officially, the administration has pledged to slash the deficit in half by the end of its term. But the Bush White House made the same promise to absolutely no avail.
And cutting the annual deficit by 50 percent isn’t enough. Washington’s willingness to spend money it does not have becomes increasingly dangerous as it grows accustomed to the practice. Just as an individual or business cannot operate on debt indefinitely, neither can the federal government.
There are two main dangers from uncontrolled deficit spending. One is that it will drive up interest rates as Washington competes with the private sector for limited funds. The second is that entities that acquire Washington’s debt may lose confidence in the government’s ability to meet its payments or maintain the value of the dollar.
In short, if Washington becomes a bad credit risk, the house of cards it has been crafting will collapse. Should that occur, the current recession will look quaint in comparison.
We believe Washington needed to act aggressively with the current recession. But with a measure of stability, the private sector must now return to the forefront. Part of that involves scaling back government spending with a goal of a balanced budget in mind.
It won’t happen overnight, but it must become a priority.
Editorials
EDITORIAL: Deficit dilemma
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High court forces lawmakers back to drawing board
The Pennsylvania Supreme Court’s decision to throw out a legislative redistricting plan exposes a fundamental truth: The mapping of House and Senate districts in the commonwealth have nothing to do with representation or serving the people.
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Our Opinion: City hurts businesses by ticketing during lunch hours
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Citizens offer to take open seat on New Castle City Council
It’s good to see there is so much interest in serving on New Castle City Council. On Tuesday, council interviewed nine citizens who have expressed a desire to fill an existing vacancy. The only unfortunate part is that most of these people weren’t interested in the post last year, when it was on the ballot.
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Second thoughts
County commissioner decides to take charge of prison board
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Our Opinion, Part 2: Mayor’s hiring of his son raises more serious questions
If you ask New Castle residents to identify the biggest problem in local government, one word will stand out:
Nepotism. The term, of course, refers to the hiring of one’s relatives for positions, regardless of the fact others are equally — or more — deserving of available positions. -
Our Opinion: Why didn’t council keep Chief Tom Sansone?
Last week, a majority on city council refused to confirm Mayor Anthony Mastrangelo’s appointment of Tom Sansone to continue as police chief. For the moment, the city has no police chief, and city residents are left to wonder why.
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Writers reveal ignorance of school board politics
Editor, The News: In a recent edition of The News there was a letter by James Smith that caught my attention.
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Fairness is consideration in Jameson Hospital’s request to city
Jameson Hospital wants New Castle to give it a break. And it’s something city council should consider — if doing so makes sense, and if it is fair to all.
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Proposal to cut size of Legislature moves modestly ahead
Efforts to streamline Pennsylvania’s Legislature took a step forward this week. But plenty of additional steps remain in what promises to be a daunting process.
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Violence flares in Mideast nation as American troops depart
It doesn’t always make headlines in America, but violence is a regular occurrence in Iraq. Yesterday, car bombings in Baghdad killed 14 people and wounded 75 others. In the United States, such bloodshed would be a major event. In Iraq, it’s just more of the same.
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High court forces lawmakers back to drawing board
