Reply #1: Summers has certainly been wrong, but these are two different things.

[BzaDem]

Summers/Rubin/etc were wrong about regulation of derivatives. That being said, the effects of regulation of derivatives are much less predictable than the effects of SS/Medicare on the deficit. Right now, everyone is flocking to the dollar due to the global crisis, but when the crisis is eased, the dollar will start to react more to high deficits like currencies in other countries (though not as much, since the U.S. is still considered a major financial and political power). Interest rates on our debt will rise.

Robert "the deficit is just a number" Reich completely ignores this problem. Deficits that are large percentages of our GDP are simply not sustainable, regardless of what Robert Reich says. Something is going to eventually have to be done to reduce the deficit and eventually overall debt (after the economy recovers).