Just wanted to point out a little word twistng in Paul Krugman's latest birdcage lining, Deficits and Deceit. He writes:

But Mr. Bush's advisers knew that the tax cuts would probably cause budget problems, and welcomed the prospect.

In fact, Mr. Bush celebrated the budget's initial slide into deficit. In the summer of 2001 he called plunging federal revenue "incredibly positive news" because it would "put a straitjacket" on federal spending.

This is in reference to some statements that Bush made at a Press Conference on August 23, 2001. I have copied in the relevant part of the transcript below. If you see the word deficit or surplus, I'll personally write you a check for $1 million. Bush was making the statement that if you give Congress less money to play with, they won't increase spending. It is clear that the President hoped that the tax cuts would stimulate growth which would ultimately increase the surplus. September 11 occured 2 1/2 weeks later.

Q Mr. President, looking ahead to those budget fights down the road, though, in '02 and '03 when you will undoubtedly be asking for more money for missile defense, many question your economic assumptions, more mixed signals today. Durable good orders, down. Home sales, up.

People question whether your 3.2 percent forecast for growth next year. Even many economists who are allied with your administration think that's too overly optimistic. On what do you base it?

THE PRESIDENT: I think -- I'm sorry Mitch Daniels isn't here to lay out all the forecasts that led to our assumption. And we're right in the middle as I understand. We picked the number that seemed reasonable.

Let's -- the facts are, our economy has slowed down. We had an anemic 1 percent growth over the last 12 months, and that affected tax revenues. And our administration, instead of wringing our hands, put in place a fiscal stimulus package that was the first real tax cut in a generation.

And we believe that's going to have a positive effect on our economy. No question the economy's slowed down. And therefore Congress must adjust its spending attitudes. The surest way to make sure that the recovery doesn't happen in a meaningful period of time or a reasonable period of time is to overspend.

So my message to the Congress is, I'm proud of your vote for tax relief, it was the right thing to do because it responded to economic circumstances that our nation now faces. But don't go hog wild. I mean, appropriators appropriate. Don't overspend. And one of my jobs as the President is to make sure we keep fiscal sanity in the budget.

Q But if you're off by just a point or two, Washington will be billions and billions short.

THE PRESIDENT: Well, if I'm off by a point or two, then Congress can adjust their sights. See, I'm glad that Congress finally, for the first time in a long period of time, said we're not going to spend Social Security except on emergencies. That wasn't the case up until this administration. It's a useful part of the dialogue if you believe in fiscal sanity in Washington, D.C. It set some important parameters.

So we have the tax relief plan, which is important for fiscal stimulus, coupled with Social Security being off limits except for -- except for emergency. That now provides a new kind -- a fiscal straightjacket for Congress. And that's good for the taxpayers, and it's incredibly positive news if you're worried about a federal government that has been growing at a dramatic pace over the past eight years and it has been.

Listen, the '02 budget we submitted has got discretionary spending growing by 6 percent. That's a pretty significant number. Certainly not as much as some of the appropriators would like to see in Washington, D.C., but we think it's a nice, balanced number. It's one that will help meet the needs and, at the same time, not overspend and therefore affect economic growth.

Of course, the other side of things is if the economy gets back to where it was growing, Washington could conceivably be awash in money, so there's leverage on both sides.