That Monster Deficit

COVER STORY

Because of it, the President's men feud, and the recovery may be stunted

During the reign of France's Louis XVI, Marie Antoinette supposedly once asked the Royal Finance Minister, "What will you do about the deficit, Monsieur le Ministre?" His reply: "Nothing, Madame. It is too serious."

In many ways, the President of the U.S. could not ask for a better election-year economy. Unemployment is falling, sales and profits are surging, investment is perking, inflation seems under control. After presiding over a deep recession, Ronald Reagan can now boast of having engineered one of the most...