David Cay Johnston is a smart guy and here's what he has to say about this politicized drama over deficits and debt:
He makes the eminently sensible economic argument: in the long run you want revenues to equal expenditures, but in the show run, if you find yourself in a recession you want to use fiscal policy -- spending -- as a tool to stimulate growth and get out of the quagmire.
Notice that at 3:30 into this video, he points out that the spend and don't tax political policies are Republican policies, but it is the Republicans who now suddenly "got religion" and are claiming you can't run a government where you spend more than you collect. Hypocrites!
Tragically, politicians and governments in the US have forgotten that lesson of the Great Depression. State legistlatures in the US are busy with austerity measures that are shrinking the economy and are puzzled to find that their tax base is shrinking! Obama has bought into the Republican myth that government are like "households" so you must make expenditures match income. Funny... these guys obviously haven't heard of mortgages, that magic bit of debt that lets a new family own a home in the twenties rather than wait until they are in the fifties when they have accumulated a cash hoard equal to the full price of a house.