An op-ed in today's Wall Street Journal describes the death of "Rubinomics," or the concept of deficit reduction as a growth policy, for the Democratic party.  Rubinomics claims that lowering federal deficits will lower interest rates which will stimulate economic growth.  While this theory was widely accepted in liberal circles in the 1990's, recent party leaders are looking to tax rebates and deficit spending in order to stimulate the economy.

But wait, what about those evil Bush deficits? Only weeks ago, Democrats claimed those were the road to perdition, even if the deficit had shrunk to 1.2% of GDP last year thanks to booming revenue growth. Remember the imperative of "pay as you go" budgeting? Ah, that was all before Iraq faded as a political winner and the economy became their favorite issue for regaining the White House. Now, all of a sudden, their motto is tax cut and spend.

"Stimulus shouldn't be paid for," declared Mrs. Clinton on NBC's "Meet the Press" on Sunday. "The stimulus, by the very nature of the economic problems we're facing, is going to require an injection of federal funding." And no less than the oracle himself, Mr. Rubin, appeared at Brookings last week to declare that a deficit-padding stimulus "can give the economy a timely boost in the face of great uncertainty and concern with the short-term economic outlook." The coroner will note that the cause of death here is suicide.

As a matter of policy, this passing is just as well. Rubinomics never did have much economic basis, and even casual observation over the last 25 years has exposed its illogic. As deficits rose in the 1980s, interest rates fell. In the current decade, deficits rose and interest rates fell for a time, then later deficits fell but interest rates rose.

Even in the 1990s, the facts never matched the theory. The rate on the 30-year Treasury bond did fall in 1993 amid the Clinton tax increases, but it slowly climbed again throughout 1994. The historic market turn -- in stocks and bonds -- came exactly on the day in 1994 that Republicans won the House of Representatives for the first time in 40 years. Interest rates move up or down based on multiple variables, such as monetary policy and global capital flows. Deficits within reasonable bounds are a bit player.

In The New York Times, Carl Hulse discusses the 2008 Congressional agenda.  FISA, SCHIP, and the Defense Authorization Act are all legislative battles that have carried over from the previous session; and many expect an economic stimulus package to be a major item on the agenda of this new year.