Is Printing Money a Free Lunch?

"US set for lowest budget deficit since 2008" read a recent CBS headline.

This year’s U.S. budget deficit is estimated to be $506 billionWhile this is a large amount in
absolute terms it is much smaller than deficits in recent years. This relative dearth of red ink has led Paul Krugman to crow, “Bad news for Dr. Evil fans: the days of a ONE TRILLION DOLLAR deficit are over. In fact, the deficit is falling fast.”