Kent Conrad: The National Debt Isn’t The Problem, It’s That We Didn’t Spend Enough On Stimulus

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Written By:
Rob Port

Jul 23, 2010
3:07pm

So how much does Senator Kent Conrad think we should have spent? More like $1.2 trillion:

If you look back at the Recovery Act and put it in perspective, you’ll see that $787 billion is a lot of money, but the economy over those three years was roughly $40 trillion. Most economists would say if you were going to provide meaningful stimulus, you needed to be at 3 percent of GDP. That would’ve been $1.2 trillion.

And the self-styled “deficit hawk” says that the national debt isn’t the problem. In fact, he suggests that some who are expressing concern about the national debt and budget deficits are “rooting against the country.”

I think some are sincere and some are not. Unfortunately, I think some, and I hate to say this, but some want Obama to fail, period. And unfortunately, Obama’s failure would be the country’s failure. In a way, some of them are rooting against the country. They want political power. I think there are others who’re absolutely genuine, who are very sincere and deeply concerned about the deficit — as am I. But timing matters in economics. It’s just the wrong medicine to engage in fiscal austerity now.

In other words, let’s keep spending and hoping that if we spend enough the economy will recover.

Which is…insane. Like trying to balance your household budget by paying your bills with credit cards. Except, in this case, the spending Conrad wants doesn’t actually stimulate the economy. So not only do we not get economic recovery, we get huge piles of new debt to boot.