The Washington D.C., Raptor.

There was once a species of raptor in Washington, D.C., known as the Deficit Hawk. These sharp-eyed creatures were known for decrying the budget deficits even as they became perennial features of the federal government's budget. They insisted, often to the loud applause of the mainstream media, that spending more than a government collects in taxes is unsustainable and the path to ruin. Concern over the size of the deficit was one of the fuels that sustained the Tea Party and Capitol Hill Republicans in the Obama years.

The Deficit Hawks have largely gone extinct, although there are reports that a few still live in captivity in the U.S. Senate and the Center for a Responsible Budget. We cannot say the demise of the Deficit Hawks is entirely lamentable. There always was something off about the insistence that a fully tax-funded budget was the sine qua non of a responsible government budget. For one thing, budgets can be balanced at very high levels of spending by simply taxing the dickens out of households and businesses. What's more, it would seem that a truly balanced budget would involve both borrowed money and taxed money, the same way households and businesses fund themselves with strategic combinations of debt and equity.

But the presentation of President Biden's budget on Friday was a reminder that the Deficit Hawks filled an important niche in the ecology of the nation's capital. Biden's budget proposes to keep budget deficits above five percent of gross domestic product through 2026, two years after his term is scheduled to end. That would make Scranton's favorite son the first president never to preside over a budget deficit below five percent of GDP. Ronald Reagan had a single year, as did George Bush. Barack Obama had a few on the heels of the financial crisis. Trump had one, last year, as the country was hurled into crisis by the pandemic. Before that, you have to go all the way back to FDR to find years of consecutive deficits that high in relation to the size of the economy.

Biden would also be the first president to preside over above five percent of GDP deficits as a normal order of business. The economy is well into recovery, growing much faster than expected. We know from the Trump years that nothing like the $6 trillion of spending Biden intends is necessary to raise the level of employment or lower inequality. In 2019, black unemployment and the gap between black and white unemployment both fell to the lowest levels ever recorded. Yet Biden's budget envisions deficits for as far as the eye can see.

The signs of heightened inflation apparently gave the president's advisers no reason to exercise budgetary restraint. That's especially worrisome because the central idea of more deficit-friendly schools of thought in recent years, such as Modern Monetary Theory, is that deficits do not hurt unless they threaten inflation. Biden's budget appears to believe just the first half of that proposition, ignoring the inflation constraint.

So we'll admit that we miss the Deficit Hawks a bit. Their shrieks would be a helpful corrective to our current excesses. But instead of trying to revive the species, perhaps we can hope for something new: Deficit Owls, a breed of raptor known not for simply hunting deficits but for wisdom about them. That is, we need a body of critics who wouldn't worry that any deficit is a problem but would recognize that running historically extreme deficits in a time of prosperity is a risky proposition. Folks who would worry not about the size of the deficit but about the inflationary effects that deficits can have in a time of a fast-running economy.

Hoo's up for it?

– Alex Marlow & John Carney