Eyevine

“PAYING for what you spend is basic common sense. Perhaps that's why, here in Washington, it's been so elusive,” said Barack Obama on June 9th. He was urging Congress to pass a new “pay-as-you-go” (PAYGO) plan that would oblige it to pay for new spending either by raising taxes or by cutting outlays. By following the same principles that guide “responsible families managing a budget”, he said, Americans could dig the country out of the “very deep hole” that “the reckless fiscal policies of the past have left us in”.

Republicans marvel at his skill in stealing their clothes. Democrats retort that, under George Bush, Republicans left their clothes unguarded while they cavorted in a hot tub of borrowed cash. Sure, they talked about fiscal responsibility. But instead of choosing between tax cuts, wars and social spending, they chose all three—and left the bill for future generations.

Whenever Republicans accuse Mr Obama of fiscal profligacy, Democrats have three easy answers. The first is to accuse them of hypocrisy—why did conservatives not speak up when Mr Bush was splurging red ink? The second is to blame all fiscal problems on Mr Bush. The third is to argue that although Mr Obama's deficit is large, it is a needed and temporary response to an emergency. In this deep recession only the government can prop up demand and fend off economic disaster.

Yet budget hawks are far from reassured. Bad as the deficit was under Mr Bush, it will quadruple this year, from $459 billion in 2008 to $1.85 trillion (from 3.2% of GDP to 13.1%), according to the non-partisan Congressional Budget Office (CBO). Mr Obama vows to halve it within four years, but that will still leave it bigger than the deficits for which he once lashed Mr Bush. Mr Obama's aides hint that he will get tough when the time is right, but he is reluctant to break campaign promises of tax cuts for all but the rich just yet. The CBO reckons the deficit will still be running at more than $1 trillion a year in 2019 (see chart). It estimates that the accumulated debt will have hit almost $19 trillion by then. Yet it was only last October (see picture above) that it breached $10 trillion, requiring an extra digit to be added to the famous debt clock off Times Square.

All such projections are tentative, of course. The bank bail-out could cost less than expected. Health-care reform could cost more. Congress seems determined that a proposed cap-and-trade system for carbon emissions, which Mr Obama was counting on to raise hundreds of billions of dollars, will raise only a fraction of that. A faster-than-expected economic recovery could restore the national balance sheet to something resembling health. A sluggish one could rip it to shreds.

Sceptics fret that PAYGO will do little to address the deficit because it has four big loopholes. The rules will not apply to the annual “patches” passed to lessen the impact of the Alternative Minimum Tax, a levy originally aimed at rich tax-dodgers but which now ensnares millions of middle-class Americans. Also exempted are Mr Obama's planned extension of many of Mr Bush's middle-class tax cuts, modifications to the estate tax and some increases in payments to doctors by Medicare (the public health plan for the elderly). Those exceptions would add $2.5 trillion to the deficit over ten years, reckons Maya MacGuineas of the Committee for a Responsible Federal Budget, a non-partisan watchdog. “This is like quitting drinking, but making an exception for beer and hard liquor,” she says.

Meanwhile, the long-term fiscal outlook grows ever grimmer. Americans are getting older. The government's unfunded obligations to give the elderly pensions and health care are equivalent to a debt of $483,000 for every household. Some find this alarming. Peter Peterson, a private-equity billionaire, is spending most of his fortune trying to educate the public about the perils of fiscal incontinence. The wave of “tea party” protests that swept the country on April 15th was evidence that plenty of voters are worried.

Republicans think they see an opening. Although Mr Obama is still very popular—his approval rating is 67%—Americans have doubts about his fiscal stewardship. In a recent Gallup poll, 51% disapproved of his handling of federal spending. Since this is the only area where most people disapprove of Mr Obama, Republicans are enthusiastically prodding it.

“There's going to come a point where it's going to be impossible to get people to buy our bonds at affordable prices,” says Paul Ryan, the leading Republican on the House budget committee. He fears that the Democrats will create a huge new spending programme—a national health-care plan—while making little effort to curb spending in other areas. That, he predicts, will lead to crushing taxes on middle-class Americans, a lower standard of living and higher unemployment.

Mr Ryan offers brave and obvious proposals to fix the budget, such as raising the retirement age. Most of his Republican colleagues, however, prefer not to be pinned down. When asked for specific examples of what they would cut, they tend to waffle about waste and fraud. This week Newt Gingrich, a former speaker of the House of Representatives, boldly came out against dodgy claims for disability payments by railway workers on Long Island.

Politically, it makes sense to pick on soft targets. Americans stopped trusting Republicans with their money in part because some conservatives were caught trousering bribes or peddling influence. Now that Democrats control Washington, the sleaze is more likely to be Democratic.

Thus Republicans are making much of the fact that Barney Frank, the Democrat who heads the mighty House financial-services committee, somehow persuaded the government-owned General Motors not to shut a factory in his district. Firms linked to Jack Murtha, a Democrat notorious for earmarking funds for his home town, are under investigation.

So far, there is little sign that Republican attacks on Democratic profligacy have had much bite, says Stuart Rothenberg, a political analyst. But he thinks that the longer they are out of power, the more their message will resonate. The Democrats have only a brief chance to show they are serious about putting America's finances in order. The bond market will punish them if they fail, and the voters will follow suit.