CATO Don't Blame Obama for Bush Deficit
Fact Check Spending Inferno
Forbes Spending
Forbes Are GOP Bigger Spenders
ZFacts National Debt
Wiki National Debt
Now the graphic below is from the CATO source and it clearly explains what most of us know. The economy started to tank in 2008, so Bush and Congress approved stimulus in late 2008 to offset the tanking of the Private sector and to help the unfortunate who were being crushed in the down turn. This money was then spent in 2009.
Then Obama and Congress approved additional stimulus spending in 2009 that would be spent in 2010. Now I may not approve terribly of Obama not cutting the spending back to it's pre-recession levels in say 2011, but to say he caused a tripling of the deficit is ludicrous. In fact the deficit has only decreased under Obama. Unfortunately this downward trajectory is going to be short lived according to this link. And the CBO Report. Thoughts?
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18 comments:
Are Presidents responsible for the economy during their term in office, or not? Very clearly, the deficits during Obama's time have consistently run above the multi-decade average, and considerably above the average of the Bush years. And I will even give credit for good intentions, in this case, if you can point to one serious effort Obama has made to reduce the deficit. And no, the ACA doesn't count, because we all knew that was phony from the get-go as deficit reduction.
Indeed. Is Bush the Lesser responsible for squandering Clinton's budget surplus or not?
Joel
Also, now that the economy has recovered from the Bush Recession, the budget deficits are in line with the deficits during Reagan's term. That's St. Ronald, the Republican.
Enough with the double standards.
Joel
Efforts Obama made to reduce the deficit:
1.) The sequester (and general spending restraint)
2.) Reduced Treasury Department financial bailouts by $225B
3.) Increased tax rates on high income taxpayers
I will accept that Bush "wasted" the Clinton Surpluses, but most of those surpluses actually occurred on Bush's watch. And despite running the deficit up, Bush also ran it down in his second term, until FY09.
And it's interesting that you pick out the Reagan years for high deficits, as well. Because unless Presidents are solely responsible for overspending, most of those years of overspending were under Democrat Congresses.
"Are Presidents responsible for the economy during their term in office, or not?"
"Because unless Presidents are solely responsible for overspending, most of those years of overspending were under Democrat Congresses."
Please try to be consistent. Your flip-flopping is making me ill.
Joel
Joel,
Good point. If the Clinton surpluses had continued, our national debt would be negligible now.
National Debt by Year
Lowering taxes and starting a war nearly simultaneously was definitely not a good idea.
"...but most of those surpluses actually occurred on Bush's watch."
2001 was the first year of Bush the Lesser's presidency...and the last year of the surpluses.
Most? Hardly.
Joel
Sean, good points.
The sequester was a ploy by Obama to get Congress to agree to a budget. I don't believe he was serious and was then surprised when Republicans approved it. Right now he is busily trying to undo it.
Not sure what you mean by "Treasury bailouts," but he did, apparently, only spend LESS than he could have, when he maybe shouldn't have spent anything at all. And was it actually done in the name of deficit reduction?
Sorry, but raising taxes doesn't count as a way to reduce deficits. History tells us that every tax increase a) doesn't raise the revenue projected for it, and b) leads to generally higher spending in the following years. The only way to reduce deficits is for outgo to be brought in line with income, and I don't see anything approaching the political will to do that. Certainly not in the current WH.
It is amazing how fast Jerry can shift criteria and methodology depending on who he is analyzing. The reality is that change takes time.
Liberals praise Dayton for his increased taxes and the great MN economy, even though they only kicked in a year or so ago.
Jerry wants to praise Bush for the 2000 surplus even though his laws had not come into effect.
I am thinking the lag is 1+ years between the cause and effect.
"Not sure what you mean by "Treasury bailouts," but he did, apparently, only spend LESS than he could have, when he maybe shouldn't have spent anything at all. And was it actually done in the name of deficit reduction?"
The TARP program, signed into law by President Bush, authorized $700B in Treasury Department spending to prop up the financial sector. Obama signed legislation in 2009 that reduced this authorization to $475B, and they actually only spent $431B.
"Sorry, but raising taxes doesn't count as a way to reduce deficits."
I'm glad you're not my accountant.
All I'm asking for is the consistency that Joel seems to think missing. My point is that if you want to blame Bush for FY09, then you also have to give him credit for FY08, and criticize Obama for FY10 and 11, talking only, now, about the deficit. And if you give Clinton the credit for FY00, then Bush gets the credit for the surplus in 01.
OK, TARP. A Bush initiative that was supposed to help mortgage borrowers. Obama diverted that to prop up the banks directly (this is my interpretation), thereby doing nothing for the general economy. Less than what was authorized, but the way it was spent it should have been zero.
"My point is that if you want to blame Bush for FY09, then you also have to give him credit for FY08, and criticize Obama for FY10 and 11, talking only, now, about the deficit. And if you give Clinton the credit for FY00, then Bush gets the credit for the surplus in 01. "
Actually, under that logic, Clinton would get credit for the FY01 surplus.
Sean, if I were your accountant I would advise against going to your employer and demanding that they pay you more because you were spending above your income. Your employer might find a way to pay you LESS, and certainly would not think it wise to subsidize your profligate ways.
I see Jeb! released his tax plan today -- one which would add $3.4 trillion to the debt over 10 years under static scoring (according to his own advisors), so yes, please tell me more about Democratic irresponsibility with the deficit.
Well, two things. First, that level is much lower than what Obama's budget plan would produce. Second, the big criticism of "establishment Republicans" like Jeb is that they want to go "to Hell in a handbasket" just like Democrats, only more slowly. Now maybe his plan looks better under /dynamic/ scoring, but Obama has broken that crystal ball-- too much stress on it to project pie-in-the-sky economic growth.
The difference between static and dynamic scoring is important, but unfortunately the former is unrealistic and the latter mostly wishful thinking. The best we can do is to think about what is LIKELY to happen, in subjective terms, knowing what we know of economic laws and human nature. For example, you cut taxes people will have more money to spend and they will find some good place to spend it. You raise taxes and people can afford to look for tax dodges, and the activity that is taxed gets reduced.
"First, that level is much lower than what Obama's budget plan would produce."
Nope. The President's Budget produces $1.2T in debt over the current baseline over the next decade, using static scoring. That's the same amount of debt the Bush tax plan produces using dynamic scoring.
"over the current baseline" ?
I think total debt incurred would be the right measure, for both plans, assuming the same assumptions in the static scoring. And it's all rather academic, in my opinion, because what needs to happen, in FIVE years or less, is to drive the deficit to ZERO. And then start paying down the debt. Meanwhile, entitlement reform must take place or the national debt is going to look like bubble-gum money by comparison.
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