To draw political attention to the federal budget House Majority Leader Steny Hoyer (D-MD) has been telling audiences that the two greatest fears expressed by Americans are the deficit and terrorism. I share Mr. Hoyer’s concern over the nation’s fiscal future, but I’m not sure Americans are suddenly attuned to macroeconomics. I suspect the words “terrorism” and “deficit” stand in for generalized anxieties about the world – the deficit and terrorism take on the form of Friedrich Schiller’s definition of the sublime.
The American people are, quite reasonably, ill at ease. Unemployment remains high, the housing market remains awful, the global financial situation remains dicey, oil continues to gush from the Gulf, terrorists continue to get arrested and apparently there are now Russian spies running around. Stuff seems out of whack. In the face of complexity or difficult to explain unease we often latch on to clear and simple definitions that are generally accompanied by clear and simple solutions. By calling the financial situation “the deficit” the American people have a way of understanding the fiscal situation that is clear, has good guys (hard working Americans) and bad guys (politicians and special interests), and has obvious solutions (common sense, get rid of waste fraud and abuse, make tough choices). With a defined proxy for broad concern about economics the American people set about responding to the proxy: if the economic situation is a mess because of deficits, spend less money to make the deficits go away and then the economic situation will be solved. The solution may or may not fit the definition of the problem, and the definition may or may not have anything to do with the problem itself, but that really doesn’t matter. Like a dog with a bone we have an explanation and are going to hang on to it.
Like the rest of us elected officials are people with generalized anxieties for which they search for intellectually manageable solutions. In addition, they get paid to respond to the anxieties of their voters, responses that often take the form of explanations of events and solutions that flow from those explanations.
Some of these solutions are balanced and make sense – many Democrats (including the President) are saying that we need to continue to stimulate the economy even if it means more deficit spending in the short term while also setting up long term solutions to our nation’s structural deficit problems. Others are not being as helpful. For example the Republican “You Cut” effort suggests things like cutting foreign assistance to countries that hold $50 billion or more in US debt for a savings to the federal budget of $180 million over 10 years. Such a move might or might not be good public policy, but it is not going to help balance the budget (according to the Congressional Budget Office our current deficit is $1.3 trillion).
Policymakers would do well to identify and remove the underlying causes of the public’s anxiety – and not rush to respond to one-word responses to pollsters about what makes them nervous. Responding thoughtfully will both remove threats and decrease anxiety – responding to the word and not the problem risks providing a false sense of security and actually increasing the underlying threat.
