When the US economic downturn began, the country’s fiscal position was already weak. The administration nonetheless proposed an emergency stimulus – mostly criticised as too miserly. Farther ahead, demographic pressures and the failure to curb rising healthcare costs (which drive up public spending on Medicare and Medicaid) make matters worse. Both presidential candidates are big on avowals of fiscal rectitude, but not on remedies. Their proposals on taxes and spending are quite different but have this much in common: if enacted, they would add mightily to the fiscal problem.

Before the economy slowed, earlier budget forecasts – admittedly unreliable at the best of times – had turned out to be too pessimistic. Revenues had proved more buoyant than expected, and the deficit had shrunk. Thus voters and politicians have come to regard all fiscal gloom as exaggerated. Congress and the administration are expected to voice concern but do nothing, and indeed to spring boldly to the economy’s support with emergency tax cuts when demand slumps. Sooner or later, this complacency will have to confront a painful fiscal reality.