Son, I want you to have this

As mentioned in the morning memo, there's a new federal budget proposal out with a whopper of a deficit figure--$410 billion for 2008. To celebrate the occasion, (and his own birthday, best wishes to you, sir) Greg Mankiw writes in the New York Times that his real birthday wish is a world where we didn't bequeath large debts to our children. Being a generation younger than Mr Mankiw, I thank him for his concern.

He is absolutely correct that we face a rather troubling budget picture. Unfortunately, he misses the mark in descrbing how the situation is worse than we think, and how it is better than we think. Mr Mankiw's first great omission is in focusing his column entirely on entitlement spending. Mr Bush's budget increases defence spending by at least 7.5 percent (and one never knows what further appropriations may be required) to a total of $515 billion. That marks the 11th year in a row in which defence spending has increased. Perhaps the world has grown significantly less safe in each of the last 11 years, or perhaps it is time to discuss whether budget cutting zeal ought to be turned exclusively toward entitlements.

Economist.com | read article