August 1, 2011 8:28AM

Debt Deals and the Default Myth

At the Encyclopedia Britannica Blog I take a look at the media drumbeat on “default”:

The establishment media have been waving around the word “default” like a bloody shirt, trying desperately to pressure the Tea Party Republicans to give in and raise the debt ceiling already. Both theNew York Times and the Washington Post on Sunday had “default” in the first sentence on the front page. Saturday’s Post featured “default” in the first line on its homepage, in the first sentence on page 1, in the first economy/​business story, and on page 1 of the Real Estate section. Friday’s CBS Evening News began, “Tonight, we are almost out of time. That was President Obama’s warning as Congress groped for a way to avoid a government default.”

But there will be no default.

As a couple of graphs show, the problem is out‐​of‐​control spending and debt.

I talked to a journalist on Thursday who was very concerned about the “dysfunction” in Washington. So am I. But I told her that the real problem is not the dysfunctional process that’s getting all the headlines, but the dysfunctional substance of governance. Congress and the president will work out the debt ceiling issue, if not by Tuesday, then by next Tuesday. The real dysfunction is a federal budget that has doubled in 10 years, an annual deficit of some $1.5 trillion, and a national debt bursting through its statutory limit of $14.3 trillion and approaching 70 percent of GDP.

So will there be any budget cuts? All the deals being discussed in recent days

promise to cut spending some day—not this year, not next year, but swear to God some time in the next ten years. As the White Queen said to Alice, ”Jam to‐​morrow and jam yesterday—but never jam to‐​day.” Cuts tomorrow and cuts in the out-years—but never cuts today.

Read it all.