For years, allegedly serious people have been issuing dire warnings
about the consequences of large budget deficits — deficits that are
overwhelmingly the result of our ongoing economic crisis. In May 2009,
Niall Ferguson of Harvard declared that the “tidal wave of debt
issuance” would cause U.S. interest rates to soar. In March 2011,
Erskine Bowles, the co-chairman of President Obama’s ill-fated deficit
commission, warned that unless action was taken on the deficit soon,
“the markets will devastate us,” probably within two years. And so on.
