If investors were more worried about inflation than weak economic growth, you wouldn't see 10-year treasury yields dropping this low, briefing falling below 2 percent for the first time ever:
For a brief moment, they even dropped below 2 percent, more than a full percentage point below where they were three months
ago. Meanwhile, the stock market has been riding a roller coaster, mostly in the wrong direction (as of midday, the Dow had
dropped 400 points). The thing that's got the market spooked isn't federal debt: it's anemic economic growth. And the public isn't any happier: President Obama's
disapproval rating on the economy is 71 percent.
The argument for doing deficit reduction now is to avoid the potential of economic problems caused by inflation later, but the reality is we've already got enormous economic problems, and those problems dwarf the potential (and likely imaginary) future risks posed by our debt.
So instead of spending all of our time trying to make the future safe from inflation, how about we focus instead on growing the economy now? Let's take advantage of the fact that people want to buy U.S. Treasuries by selling them some. And let's use the proceeds to invest in our nation's future—and put Americans back to work.