Editore"s Note
Tilting at Windmills

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December 16, 2009

THE SOURCE OF THE DEFICIT MESS.... Republican lawmakers and far-right activists have suddenly discovered, after eight years of dramatic fiscal irresponsibility, that they care deeply about deficit reduction again. Worse, they're absolutely convinced that President Obama and those free-spending Democrats are responsible, putting a terrible burden on future generations.

The Center on Budget and Policy Priorities released a report today, analyzing the existing deficit in detail, and what factors created it. Here's hoping Republicans and Teabaggers are paying attention.

Some critics charge that the new policies pursued by President Obama and the 111th Congress generated the huge federal budget deficits that the nation now faces. In fact, the tax cuts enacted under President George W. Bush, the wars in Afghanistan and Iraq, and the economic downturn together explain virtually the entire deficit over the next ten years.

12-16-09bud-f1-infocus-landing.jpg

The deficit for fiscal 2009 was $1.4 trillion and, at an estimated 10 percent of Gross Domestic Product (GDP), was the largest deficit relative to the size of the economy since the end of World War II. Under current policies, deficits will likely exceed $1 trillion in 2010 and 2011 and remain near that figure thereafter.

The events and policies that have pushed deficits to astronomical levels in the near term, however, were largely outside the new Administration's control. If not for the tax cuts enacted during the Presidency of George W. Bush that Congress did not pay for, the cost of the wars in Iraq and Afghanistan that began during that period, and the effects of the worst economic slump since the Great Depression (including the cost of steps necessary to combat it), we would not be facing these huge deficits in the near term.

This isn't just about pointing fingers for self-satisfaction or partisan vanity. It's important for the public to realize who's responsible, in large part because it's important for the public to weigh policymakers' credibility. If GOP lawmakers embraced policies that are almost entirely responsible for the deficit those same lawmakers are now complaining about, it's a relevant detail.

And on a related note, for those who believe deficit reduction must be a top national priority -- a group that's apparently pretty large -- it's important to recognize which party's proposals are effective in improving, or not, the fiscal landscape.

President Obama will deserve plenty of blame over the course of his presidency, but holding him responsible for getting us into this budgetary mess doesn't make sense.

Steve Benen 10:40 AM Permalink | Trackbacks | Comments (27)

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Comments

And look at the out-years..the Bush tax cuts dwarf the others.

Posted by: Mudge on December 16, 2009 at 10:47 AM | PERMALINK

Reagan PROVED that (Republican) deficits don't matter!

Thankfully, Obama and the Dems don't have the balls to put in place a truly progressive tax code. Banksters rule their world.

Posted by: Dems lose huge in 2010 on December 16, 2009 at 10:58 AM | PERMALINK

As far as I'm concerned, ALL of that is Bush's fault. He started those wars, he pushed for those tax cuts, and it's his fault we needed TARP and the stimulus in the first place.

Posted by: Notorious P.A.T. on December 16, 2009 at 11:00 AM | PERMALINK

Glenzilla just chewed you up, Steve. Quit being an apologist for Obama - this crappy health care bill is what he wanted.

Posted by: DougMN on December 16, 2009 at 11:03 AM | PERMALINK

"Here's hoping Republicans and Teabaggers are paying attention"

Sure. First of all, do you think CBPP charts will be displayed on Fox News all day?

Second of all, the teabagger response is, "Oh I think Bush was a bad spender too". They don't answer why they didn't go crazy in protest all these past 8 years, but just saying, that's their response.

Side note: we need more charts like these. Not Ross Perot levels but charts always helped me understand, and helped me help others understand. I don't know why the Dems don't use them more.

Posted by: Ohioan on December 16, 2009 at 11:08 AM | PERMALINK

But... but... Tax cuts are supposed to raise revenue. You're just not believing in Reagan hard enough!

Posted by: Grumpy on December 16, 2009 at 11:14 AM | PERMALINK

President Obama will deserve plenty of blame over the course of his presidency, but holding him responsible for getting us into this budgetary mess doesn't make sense.

So, what's new about that?

Posted by: qwerty on December 16, 2009 at 11:19 AM | PERMALINK

Politicizing empirically sound economic data is a dastardly act by anyone's measure. You go Republicans! -Kevo

Posted by: kevo on December 16, 2009 at 11:25 AM | PERMALINK

Many people forget that the Bush administration did not include the wars in Iraq and Afghanistan in the budget.. These were paid for with supplemental spending bills in order to hide the costs.

If Obama took the wars off the books the deficit would not look as bad.

Posted by: wbn on December 16, 2009 at 11:30 AM | PERMALINK

Yeah, Cheney said "Reagan taught us deficits don't matter", and the teabaggers suddenly realize they should run around griping about the debt. I don't like a big debt either, but the hypocrisy ...
We need to balance the budget during "normal" times, so we can use deficit spending to get out of a financial crisis.

Posted by: neil b on December 16, 2009 at 11:47 AM | PERMALINK

If you think deficits are bad now, wait till you see what they after President Pawlenty and the GOP Congress cut taxes in 2013.

Posted by: Steve M. on December 16, 2009 at 11:47 AM | PERMALINK

Yes, but this is an explicit Republican strategy, "Starve the beast."

Run up deficits during Republican administrations, then force deficit reduction during Democratic administrations. The idea is to limit spending on Democratic priorities by keeping the debt near the maximum tolerable.

They have been doing it since Reagan. This is nothing new.

Posted by: Greg on December 16, 2009 at 11:47 AM | PERMALINK

If the economy is recovering well by next summer and employment is rising at a good clip, none of this doom and gloom will matter come the elections in November; if it isn't, then no amount of explanation will make a difference.

Posted by: larry birnbaum on December 16, 2009 at 11:58 AM | PERMALINK

Taxes are being cut by the IRS to big banks.

They get bailed out using taxpayers' money, then when they return the money, the IRS steps in and gives them huge tax-breaks so that they can become "healthy" again. Tell me again how such a move helps to shrink the deficit?


We are being screwed folks.

I'm not making this stuff up.


Posted by: Tom Nicholson on December 16, 2009 at 12:00 PM | PERMALINK

Why, if we just cut out all the welfare and the foreign aid, and wastefraudandmismanagement, that budget sucker would be balanced in no time.

Posted by: Generic GOP House Member on December 16, 2009 at 12:09 PM | PERMALINK

One question: why is the effect "economic downturn" permanent? Apart from the difficulty of projecting macroeconomic conditions 10 years down the road. Ditto, the possibility (however remote) that war spending might evaporate after 2011.

Posted by: Grumpy on December 16, 2009 at 12:17 PM | PERMALINK

Nice graph, err spin, methinks it's missing something, like truth?

I'm curious, as a conservative, not a republican, I wonder why the assumption is that I supported the excess of the Republican majority? Two wrongs do not make a right. Bush era excess is not solely responsible for future deficits.

Spending under Bush was bad, but only 6 years of that was "republican". Spending under Obama is far worse and in less than a year the congress and the President have managed to push our debt to the brink of insolvency and collapse.

Like congress I know that if I spend all my credit cards up to the max or beyond that'll improve my fiscal position next year, right?

Unlike the Congress and this President I can at least recognize that the debt and the interest on that debt is likely to crush our economy well past the date on my death certificate.

Posted by: Flyfish on December 16, 2009 at 12:49 PM | PERMALINK

Flyfish is just another typical anti-Obama rightwinger. When faced with facts that don't fit into their narrow world-view, people like Flyfish just choose to ignore them and go on believing and trying to argue their reality-adverse beliefs. There have been multiple studies analyzing the current deficits and all have come to same conclusion - that the Bush era policies (2 tax cuts, 2 wars, Medicare Part D, NCLB - all unpaid for) and the Bush Recession are to blame for the current budgetary mess. The small contribution by Obama has been in enacting measures to pull us out of the Bush created economic decline.

I suppose Flyfish would say that the Stimulus "failed" and that Climate Change is a "hoax" and that there really were "death panels" in the health reform legislation. I know reality has a liberal bias, but you and your ilk need to do this country a favor and pull your heads from your arses or sit down, whipe the spittle from your mouths and shut up.

Posted by: GiggsisGod on December 16, 2009 at 1:30 PM | PERMALINK

FlyFish,

Your entire opinion is based on the myth that Obama's contribution to the deficit even remotely compares with Bush's. Here's the facts:

National Debt by 2000: $5.5 trillion
National Debt November 2008: $10 trillion
National Debt by March 2009: $11 trillion

Even worse, the the 2009 fiscal year began on October 1, 2008, and the vast majority of the spending for our 2009 fiscal year was the result of Bush Administration policies.

Our entire national debt from 2000 to March 2009 had NOTHING to do with Obama. But Fox News has screwed your noggin beyond reach with gross ignorance. How can you even compare the two presidents? It's unfathomable.

Posted by: gary on December 16, 2009 at 2:12 PM | PERMALINK

Does anyone remember the Democrats were in charge of the House and Senate since 2007? Do they get a pass on the blame for the economic downturn? I remember reading somewhere in the Constitution that Congress has some sort of responsibility when it comes to the budget.
Will all of you give the GOP a pass if they take one or both houses in 2010 and the economy is still rotten in 2012?

After giving a precursory glance at the CBPP website, I would hardly characterize their assessments as non-partisan. I do not know their assumptions behind this graph but if they have a political ax to grind (and it appears they do) then the conclusions they draw are suspect.

So let me see if I have the right...
The last 8 years, most of which were economically solid by anyone's estimation, are on the whole a failure. Bush is solely to blame even though the Dems were in control of Congress for the last two years of his presidency. Obama has ONLY taken steps that were absolutely necessary to help the economy so if things do not improve it wont be his fault because he was "trying to do the right thing." If the economy doesnt turn around we can still only blame Bush because Obama and the Dems inherited such a mess.

Wow! you guys are masters of twisted, spin-laden logic. I mean I knew that many liberals were incapable of admitting error or accepting responsibility for their actions but this takes the proverbial cake.

Posted by: Noah Johns on December 16, 2009 at 2:29 PM | PERMALINK

I thought the Bush tax cuts expired next year.

Posted by: Ho Lynn on December 16, 2009 at 2:56 PM | PERMALINK

Ha! I'd sure like to see the years proceding 2009 on that chart. '08 total deficit was a "record" .45 trillion. It had been falling for the few years predeing that with a low of .16 trillion in '07. I guess the authors didn't include that because it wouldn't have hardly shown up on the chart! ;o)

Posted by: Cool Paul on December 16, 2009 at 3:56 PM | PERMALINK

Noah Jones,

Had you turned elsewhere beyond Fox News, you'd have read how all the economic "growth" of the past 8 years was concluded to be a result of the housing bubble. And that when you factor that out as well, the employment rates were actually 100% stagnant under Bush's term and actually declining with respect to population growth.

Posted by: gary on December 16, 2009 at 5:06 PM | PERMALINK

As the WaPo showed, based on CBO data (http://tinyurl.com/cw6uy5), the deficits under bush were on their way down. Yes, that included Iraq and Afghanistan. Then along came the "responsible" liberals who catapulted the spending.

Let's not forget, Chairman Obama promissed to cut spending. Hasn't happened. Instead, he's adding another $1 Trillion, at least, to the $700 Billion of Bush's expansion. Bush also increased federal spending on EDUCATION 58% faster than inflation. Chairman Obama has proposed to double down.

Let's also not forget that the tax cuts "for the rich" brought in record levels of revenue to the treasury and gave us 52 consecutive months of job growth. Chairman Obama's massive spending has done neither nor will it.

Of course the CPBB will bury any reality that urinates in their brethren's Cheerios.

Posted by: TGC on December 16, 2009 at 7:13 PM | PERMALINK

What's more, one still has to wonder why Bush's spending is such a bad idea, but Chairman Obama's massive spending is great. They just can't seem to answer that one.

Posted by: TGC on December 16, 2009 at 7:14 PM | PERMALINK

TGC, BushCo raised the debt during "normal" times, and used it to enrich the already wealthy, mil-indust complex etc. That made it hard to use stimulus deficit spending as it's meant to be, which is to rescue an economy during a crisis. The argument about tax cuts bringing in so much money are also suspect (where is the counter-factual analysis showing that the increase wasn't due to other factors, such as the wealthy earning more to start with relative to the rest of us, for various reasons, rather than an overall stimulus from tax cuts per se?

Posted by: neil b. on December 16, 2009 at 8:14 PM | PERMALINK

Let's also not forget that the tax cuts "for the rich" brought in record levels of revenue to the treasury and gave us 52 consecutive months of job growth.
club penguin

Posted by: john mish on June 19, 2010 at 3:57 AM | PERMALINK




 

 

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