If you are worried about the deficit, or if you’d like to receive Social Security some day when you retire (or if you become disabled), then Jamie Galbraith’s article In Defense of Deficits in the Nation is a must-read.

the deficit phobia of Wall Street, the press, some economists and practically all politicians is one of the deepest dangers that we face. It’s not just the old and the sick who are threatened; we all are. To cut current deficits without first rebuilding the economic engine of the private credit system is a sure path to stagnation, to a double-dip recession–even to a second Great Depression. To focus obsessively on cutting future deficits is also a path that will obstruct, not assist, what we need to do to re-establish strong growth and high employment.

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Either way, until we have effective financial reform, public budget deficits are the only way toward economic growth. You don’t have to like budget deficits to realize that we must have them, on whatever scale necessary to restore growth and jobs. And we will need them not just now but for a long while, until we’ve shaped a strategic program for investment, energy and the environment, financed in part by a reformed, restored and disciplined financial sector.

It’s possible, of course, that all the deficit hysteria is intended to divert attention from the dysfunctions of private banking, and so to help thwart calls for financial reform. Is that giving them too much credit?

Personally, I definitely see the deficit hysteria as the con-man/magician’s hand-waving distraction.  TPTB agitate and stir the pot to get folks upset about some boogie-man called the deficit.  It’s hand-waving. While the public (particularly the Tea-Partiers) are watching the hub-bub about the deficit, Wall Street and the big banks continue to loot country and (they hope) shoot down the idea of social security.  It’s nonsense, but the danger is real. Not the danger of deficits, but the danger of being distracted by the deficits.