"Economists have estimated the US budget deficit could more than double next year to almost $1,000bn," reports The Financial Times, "raising concerns about whether Mr Obama could deliver on expensive campaign promises including $150bn in investments in alternative energy over the next decade and a $60bn-$110bn plan to provide universal health insurance for Americans." As you might expect, this paragraph pissed Dean Baker off. In a post entitled "Do 'Economists' Have Names?" he writes, "None of the economists I know raise those concerns. They believe that the economy is facing a severe recession in which large deficits are absolutely essential to sustain demand and to keep the unemployment rate from rising too high. While there may be economists who do raise concerns that the deficit is getting too large, the Financial Times should identify economists who hold this view instead of implying that most economists believe that the deficit is too large." On some level, I think he's simply misreading the Financial Times. They didn't say that economists are concerned about deficit spending. Rather, they said economists estimate the possible deficit at $1 trillion. That's true. It's also a meaningless number important only because human beings are oddly fascinating with sums that end in zero. $1 trillion is a large deficit in a country with a GDP of $8 trillion and a small deficit in a country with a GDP of $20 trillion. Deficits cannot be understood in terms of absolute values, only relative to the broader economy. In any case, this estimate has spurred unnamed others to raise concerns about Obama's ambitions. There's no evidence in that quote, however that any of those others are economists. Indeed, as Brad DeLong notes, there seems to be a professional consensus among economists that financial sector reforms and stimulus are of overwhelming urgency, and deficit reduction can wait.
