The New York Times’s David Leonhardt has a smart column this morning on the administration’s skewed spending priorities. By spelling out why they’re skewed, he gives some insight into what’s wrong with the economy more broadly.

Specifically, he looks at what’s wrong with the Obama administration’s recent proposal to send everybody on Social Security a $250 check next year. Boy, I’d hate to see his inbox today. There’s a reason they call it the “third rail.”

It’s not hard to see the Obama move as a cynical ploy to placate the old folks who have been perhaps the biggest threat to the administration’s health-care reform.

But as Leonhardt points out, those over 65 have done better than younger families, most of which are still in the workforce.

The real median income of over-65 households rose 3 percent from 2000 to 2008. For households headed by somebody age 25 to 44, it fell about 7 percent.

That last number goes a long way toward understanding why the country finds itself in so much debt. I mean think about it: The average household in that huge younger age group had a real 7 percent pay cut during those eight years, despite what Larry Kudlow and the like called the “Goldilocks Economy” of low interest rates, low inflation, and good GDP growth.

As Leonhardt notes, even though Social Security recipients (not all of whom, it should have been noted, are old) aren’t getting a cost-of-living adjustment this year, they’re still coming out ahead because we’re in the midst of deflation. Prices are down 2.1 percent in the last year, he reports, which of course is an effective 2.1 percent raise if you’re getting the same amount of money.

This is a concept that needs to be explained to people, something I think the press has not done a good job of doing.

It has also not done a good job reporting on the simple, obvious fact that we’re in deflation—despite the government’s best efforts to reinflate a bubble—and the implications of that. We’ve heard seemingly forever dark warnings in the press about the perils of deflation. Now that we’re in it, it would be great to see some more reporting on it.

Meanwhile, the fact is something’s going to have be done to entitlements at some point soon, whether it’s raising payroll taxes or cutting benefits or both. But:

“If the long-term issue is entitlement reform,” says Joel Slemrod, a University of Michigan economist, “the fact that the political system cannot say no to $250 checks to elderly people is a bad sign.”

Ryan Chittum , a former Wall Street Journal reporter, is deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at rc2538@columbia.edu.