Morning Bell: Can We Avoid Becoming Europe?
Conn Carroll /
The Treasury Department announced yesterday that the federal deficit for April soared to $82.69 billion, more than twice the $40 billion deficit that Wall Street economists had predicted. An April deficit is rare for the federal government (there has been a surplus in 43 out of the past 56 years) and the announcement marked a record 19th consecutive month that the Treasury has posted a shortfall. Like those who said there was no housing bubble, some on the left who crave an ever larger federal government are still saying that Americans have nothing to worry about. That we can borrow and spend forever. But many in the center left are beginning to wonder if emulating Europe, as President Barack Obama’s policies are pushing us to today, is such a wise policy.
The Washington Post reported on its front page that the bailout of Greece was forcing “European governments [to] rewrite a post-World War II social contract that has been generous to workers and retirees but has become increasingly unaffordable for an aging population.” And a New York Times headline blared In Greek Debt Crisis, Some See Parallels to U.S. with David Leonhardt reporting: “The numbers on our federal debt are becoming frighteningly familiar. The debt is projected to equal 140 percent of gross domestic product within two decades. Add in the budget troubles of state governments, and the true shortfall grows even larger. Greece’s debt, by comparison, equals about 115 percent of its G.D.P. today.”