The Overton Window

Given the objective constellation of forces, I don’t think it was necessarily a mistake of the White House to sign off on the appropriations deal. The deal will hurt the macroeconomy, but a shutdown would have hurt it more. But the administration’s rhetoric about the deal is a good deal harder to accept. When people with badly wrongheaded ideas about economic policy gain control of congress, bad deals become inevitable. Signing them is forgivable. Turning around and calling the bad deal a good one is much less forgivable.

Now we have Barack Obama hailing large spending cuts at a time of high unemployment and low interest rates and Mike Pence saying the deal’s not good enough to vote for. John Boehner now holds the center ground, and “everyone agrees” that it makes sense to reduce aggregate demand in the middle of a recession.