I take up Delong's challenge on austerity

He lists some points about mindless austerity. Let's go over some of his points.

As long as unemployment is elevated and the real interest rates on government debt are less than the growth rate of the economy, the economy is in a substantial deficient-demand equilibrium and the government ought to be spending more, investing more, and taxing less.

OK, inflation has been negative for the past few months, .25 to .5%, deflation (projected forward a year).  The federal government pays the ten year rate and it has been 2.1 to 2.2% recently.  Growth has been averaging about 2.3% and the recent growth surge is about to be revised down due to imports.  Hence, according to Delong the federal government should not increase spending.

The 25-year fiscal gap is only 1.2% of GDP–a thing that could be closed by simply uncapping the FICA base and the fumes from the carbon tax that we must introduce over the next generation to get our environment on a long-run sustainable path.

OK, now I am perplexed. How does a CO2 tax reduce CO2 if we just apply it to the entitlement gap?  He is implying that working people are less energy efficient than retired people.  How did he reach this conclusion?

The sequester, especially, is simply an awful policy, and ought to be eliminated.

But wait, his first point above indicated that government spending should be held steady, and the inflation rate is now near zero.  He proves the need to sequester in one point then disclaims his logic in another.

Here Brad is a Fred chart to help.  Note, quarterly price deflator slightly negative. Quarterly growth is  .61.  Quarterly interest payments on the ten year rate government pays is about .55.  So, DC is there, DC should stop spending growth or Brad should change his logic.

So, I am sure he will fill us in on the contradictions.