Wait for debt-deal details before final sigh of relief

Look for all sides in the debt limit debate to begin declaring victory, and feel free to take most of those declarations with a grain of salt.

Certainly Sunday night’s announcements by President Barack Obama and congressional leaders from both chambers and both sides of the aisle that a default-avoiding agreement had been reached was good news.

Default was never a survivable option, and even running the debate up to the last minute was shown to have economic consequences. Those were felt in many ways, from drops in the stock market to drops in consumer confidence that were having a particularly bad effect in the already troubled housing market.

The bigger question that will have to be answered when details of the agreement become known is how much of an effect this agreement will have on the economy going forward — and whether the partisan bloodletting and economic trauma were worth it.

One thing that all sides should be able to agree on is that raising the debt limit — something that had become a bipartisan ritual over nearly a half century — doesn’t solve the problem.

Finally, it seems, Washington is ready to recognize that deficits do matter — and the irony is that Republicans, who famously pretended for so long that they didn’t matter, will try to take all the credit for acknowledging that they do.

Painting with broad strokes

The nature of the agreement is known only in the broadest of terms and only from snippets released by the various players.

President Obama said the agreement will cut $1 trillion in spending over the next 10 years and will result in the lowest level of annual domestic spending since Dwight Eisenhower was president.

House Speaker John Boehner said the deal contains no tax increases and sets the stage for more than $2 trillion in spending cuts

Obama said the deal will still allow the government to make “job-creating investments in things like education and research” and that cuts that are made won’t happen so abruptly they they’d create a drag on the economy. He also made it clear that tax reform is necessary to address what he believes are inequities.

None of this is specific enough to assauge the considerable fears and misgivings that the American people have about how budget cuts — which are obviously necessary — may affect them. Millions of people beyond government employees depend on government spending — from construction workers on highway projects to doctors and hospitals waiting Medicare and Medicaid payments, to retirees dependent on Social Security. And certainly the financial markets are going to want more details before the United States AAA bond rating is declared safe.

But there is relief in having dodged the bullet of default, which could have crippled the economy in a very short time and for a long time to come.