Debt crisis? What crisis?

One of the things I really enjoyed as a young man in the Navy was watching some of my friends who had imbibed a bit too much at the bar and seeing somebody else say, “You just need another beer. You’ll be fine.”


I was taken back to those days when I saw Steve Benen’s approving review of a piece by Bill Gross where he informed all of you Chicken Little types that you need to stop worrying about the debt and the deficit and just get on with your lives.

It’s tempting to think Bill Gross’ perspective on the economy would be taken fairly seriously. After all, he’s the co-founder of investment management giant PIMCO and one of the most influential investors in the world.

And as Brian Beutler reports today, Gross has prepared a prospectus for his clients arguing that the political world’s focus on the debt in the midst of a struggling economy is ridiculous, and what’s needed is another meaningful stimulus package.

Where does one even begin with this? We might start – were we suspicious by nature – by noting that Gross, at PIMCO, is deeply involved in a business which tends to prosper when the federal government flushes large amounts of cash into the system. But we don’t really need to rely on that.

Benen goes on to give a nod to another comment by Gross where he says, “fiscal balance alone will not likely produce 20 million jobs over the next decade.” This is actually a true statement, but it’s also akin to saying that since the shed isn’t currently on fire there’s no need to save the house which is already burning down. Fiscal stability and a negative curve on the debt, by themselves, will not create jobs. (Though they do add to manufacturer confidence in the overall, long term viability of the infrastructure which is needed to grow business.)


What does bring jobs home is an atmosphere more conducive to business, created by a low tax burden, reduced cost of staffing and maintaining workers such as health care expenses and legacy union burdens, and the ability to repatriate overseas profits without being taxed twice on them. But, again, none of Benen’s arguments apply directly to whether or not we should be tackling the debt.

Benen closes with this unsupported argument.

Americans’ top concern, by far, is job creation and economic growth. The single best way to address the issue [additional stimulus spending] isn’t even on the table, thanks in part to Republican dominance of the discourse, progressive timidity, and the public’s conditioning to oppose “spending.”

This is the typical course of last resort: if the public isn’t supporting your idea, they must be too stupid to understand the issue. We must have “conditioned” (read: brainwashed) them. Fortunately for us, a growing majority of Americans do understand that that nation of Greece is a cautionary tale, and one we need to learn from. I’d be interested in hearing Mr. Gross address that question in particular.

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Jazz Shaw 3:01 PM on September 21, 2023