Via a sympathetic Reuters reporter, President Barack Obama wants us to believe he is worried about the budget deficit:
“It is important though to recognize if we keep on adding to the debt, even in the midst of this recovery, that at some point, people could lose confidence in the U.S. economy in a way that could actually lead to a double-dip recession,” he said.
Most commenters have focused on what they see as the shameless hypocrisy that the biggest spender in the history of money would claim to be Dave Ramsey. Others have noted that there is no recovery, though Mr. Obama wishes with all his little heart for it to be so. But I don’t think he was hypocritical at all, and I don’t care if he wants to call government expansion a recovery, when the people know otherwise. I’d like to focus on another issue, which is Mr. Obama’s vapidity. His statement is so stupid, it’s not even wrong.
There is a difference between debt, deficits, and spending. The only way we add to our debt is if we have a deficit between the amount of money that we spend and the amount we take in. There are two ways to avoid that, growth aside: spending less and taxing more. I only mention these things because everyone else, as I said, is calling him a hypocrite. What he is really doing by declaring war on the deficit is setting up a tax increase.
Mr. Obama says that if we “keep on adding to the debt” there will be trouble. I say he’s not even wrong because it is true, in a general sense, that as we keep adding to the debt it sucks investment capital into bankrolling the government through safe Treasury bond issues. He says that “people could lose confidence” in the U.S. economy, but what he really means is that the Chinese and other Asian investors could lose confidence in the ability of the U.S. Government to pay interest on its debts, if the economy continues as it is.
Notice that the President doesn’t say he wants to decrease spending, or that the spending is the problem. He only talks about adding to the debt.
When this President speaks, hold on to your wallet.