Deficit Discourse: The Social Construction of Fiscal Rectitude

Abstract

Budget deficits are bad, very bad indeed. Creating them was indulgent; tolerating their continued existence, insufferable; reigning them in, imperative. Or so we are led to believe. The 1990s has been a decade of budget-cutting austerity and restructuring in most advanced industrialized countries. Great attention is directed to competitiveness as the liberalization of trade rules is extended further, and as governments seek to attract scarce financial capital (Gill and Law, 1989; Sinclair, 1992; Cerny, 1993; Krugman, 1994b). In many countries, government budget deficits have been identified by neo-liberal policy intellectuals as one of the leading causes of relatively lower growth rates and persistent unemployment (Williamson, 1994: 26). Deficit reduction has become a major priority for governments, and strategically important elements within many civil societies seem to support this objective.

The budget has been to our era what civil rights, communism, the depression, industrialization, and slavery were at other times.²

This chapter was first presented at the 1996 annual meeting of the International Studies Association in San Diego. Subsequently, it was also given at the ‘Globalization and its Critics’ workshop at the University of Sheffield, and in revised form to departmental seminars at the University of Sussex and the University of Arizona. For useful comments, I thank Bill Dixon, Bud Duvall, Randall Germain, David Gibbs, Roger Haydon, Martin Hewson, Paulette Kurzer, John MacLean, Cary Nederman, Rob O’Brien, Ronen Palan, Jonathan Perraton, Herman Schwartz and Lord Skidelsky. Responsibility for the arguments remains mine.