If one deficit matters, two matter twice as much

We continue to be amazed that an administration that apparently considers itself conservative doesn't recognize the very unconservative nature of running up deficits.
The Congressional Budget Office's latest estimate is that over the next decade the federal deficit will get no lower than $229 billion per year, and that will be in 2010. The CBO said the cumulative deficits of Bush's budget over 10 years would be $2.58 trillion. And that does not include the cost of the wars in Iraq and Afghanistan, the cost that would be incurred if private accounts were added to Social Security (a minimum of $1 trillion) or the cost of readjusting the Alternative Minimum Tax.
Another gap
Meanwhile there is another deficit in the news. The monthly trade deficit hit $58.3 billion in January, the second-highest in history.
The Commerce Department's trade report released Friday showed a January trade gap that was 4.5 percent higher than December's $55.7 billion deficit and was just below the all-time monthly record of $59.4 billion set last November.
The U.S. trade gap hit a record $617 billion in 2004, an increase of 24.3 percent over the previous year. It was the third record year in a row, and at the present rate, 2005 will be a fourth straight record. Over those four years, the nation will have run up more than $2 trillion in trade deficits.
So at the very time that the nation is spending trillions more domestically than it is collecting in taxes, its people are buying trillions of dollars more in goods from other nations than those nations are buying from U.S. companies.
That is an incredibly unhealthy combination.
No sense of anxiety
And even more troubling is that the Bush administration has shown no sense of alarm over these events.
President Bush continues to be committed to making his tax cuts permanent, even though to do so will drive the projected deficits even higher, since the CBO's figures are predicated on present law, which calls for some of the cuts to expire.
And on trade policy, the administration continues to show an unbending allegiance to free trade (rather than fair trade) and refuses to confront China on a number of trade issues, including that nation's monetary policy. By refusing to allow the yuan to float against the dollar, China makes its exports to the United States cheaper while inflating the cost of U.S. products being exported to China.
Just last week, Federal Reserve Board Chairman Alan Greenspan warned that the massive federal budget deficit accumulated under President Bush is "unsustainable."
And the financial markets sent their own message about the sustainability of trade deficits. The Dow Jones industrial average fell 77.15 points to close at 10,774.36 Friday and the dollar declined against the 12-nation euro and the Japanese yen.
When will the administration and Congress begin to listen to the conventional wisdom on the deleterious effects of budget and trade deficits?