I have been reading Robert Dallek’s magisterial biography of John F. Kennedy and came across an item of great contemporary relevance. Among the interesting facts about President Kennedy was his “fiscal conservatism.” He did not fit the caricature of the big spending liberal. In fact, he had a certain antipathy toward FDR not only for his “New Deal” programs, but also because he thought FDR had appeased Stalin during World War II.
In any case, as a Congressman JFK openly opposed “unbalanced budgets,” which he perceived to be a threat not only to the economy but also to national security. From Dallek’s biography:
In 1947, he openly opposed a Republican proposed tax cut, which he attacked as not only unfair to lower-income citizens but also a menace to economic stability. In 1950, he spoke out against Democratic-sponsored spending plans on social programs that could lead to a “dangerous” $6 billion deficit; he instead suggested a 10 percent across-the-board cut in appropriations. “I do not see how we can go on carrying a deficit every year,” he declared on the House floor. “Does not the gentleman think that a very important item in the cold war is the economic stability of the country so that we have resources in case of war?” (pp. 142-43)
I don’t know about you, but a $6 billion annual deficit doesn’t sound so “dangerous” to me anymore. Our deficit now is about 20 times that amount in any given month! Even after adjusted for inflation, that’s a truckload of difference.
The amount of money at stake was much smaller then, but JFK’s concern was prescient. The country can’t just “go on carrying a deficit every year” and expect to have its fiscal house in order. We are finding out now the hard way just how right he was.