As we careen headlong toward the debt ceiling deadline, with the House Republicans and Speaker John Boehner in full Three-Stooges-Trying-To-Fix-The-Plumbing mode, the issue area that’s been overshadowed by the grandstanding, political props and brinksmanship is government spending itself. [UPDATE: it appears as if there’s a deal to raise the debt ceiling and re-open the government.]
The budget deficit is really the 4,000 pound gorilla in the room and the Republicans refuse to discuss anything other than the fact that employer mandate for the dreaded Affordable Care Act begins a year after the individual mandate. Yes, we’re in the middle of a showdown over the debt because of Obamacare rather than, you know, spending and fiscal responsibility.
Why aren’t they talking about the deficit? That’s easy: they can’t say anything bad about it because the Obama administration’s record on the deficit is kind of stellar.
Let’s review some numbers.
While it’s true that, in a general sense, the debt, $16 trillion, is higher than ever before, but it has less to do with President Obama, and more to do with the previous administration’s tab for careless spending on two wars which it refused to offset by rolling back its ridiculously large tax cuts for the super-rich. Couple those losses with the globally massive economic depression from which we’ve only recently extricated ourselves. Yes, critics of the administration are correct when they say the debt is on track to double. However, it’s not due to the administration’s actions, but rather the policies of the previous administration.
Historically speaking, Ronald Reagan presided over a 188 percent increase in the debt. Bush 41 presided over a 55.6 percent increase, and Bush 43 presided over an 89 percent increase. At the same time, the year-over-year increase in the debt under President Obama has dropped from 15 percent to four percent.
Still, the debt is indeed quite large, but what’s the first step in confronting it? Reducing the deficit, but not so hastily that it disrupts economic growth.
Before we get into where we stand with the deficit, it’s important clarify that the deficit and the debt are two very different things. I know it’s obvious, but I’m always surprised by how many people confuse the two figures. Just to review: the federal budget deficit is the annual difference between what the government spends and what it collects in revenue. The debt is the total amount of money the United States owes to creditors, and this much larger figure accrues from year to year. So that’s that.
Now, specifically regarding the deficit, let’s rewind to former President Bush’s final 2009 budget request in October, 2008. Bush generated a $1.2 trillion deficit for President Obama’s first year in office, and Obama tacked on another $200 billion to bring the grand total for the deficit that year to $1.4 trillion.
But since then, deficit spending has dropped precipitously. Why? Chiefly because President Obama signed the Statutory Pay-As-You-Go Act in February, 2010, which mandates that new spending be offset with spending cuts or new revenue. Yes, a Democratic president and a Democratic Congress passed this legislation. Guess how many congressional Republicans voted for the law. Zero. Not one.
Consequently, the president is responsible for the lowest government spending growth in 60 years, according to the Wall Street Journal‘s Market Watch.
In February, 2009, Obama made the following pledge: “This administration has inherited a $1.3 trillion deficit — the largest in our nation’s history — and our investments to rescue our economy will add to that deficit in the short term. […] And that’s why today I’m pledging to cut the deficit we inherited in half by the end of my first term in office.”
Well, he was only off by eight months. Back in May, the Congressional Budget Office forecasted the 2013 budget deficit at $642 billion by the end of this fiscal year. So while it took eight months longer to meet the president’s goal, the administration indeed met it with tens of billions to spare. Now, it’s worth noting that we don’t know the final number, which would’ve been released last week. Why? The government shutdown also closed the CBO.
So how does this record fare alongside previous administrations?
I can name two Democratic presidents who’ve cut the deficit through the duration of their presidencies: Clinton and Obama. And what about Republican presidents? Bush 43? He turned a $200 billion surplus into a $400 billion deficit by the end of his first term, and a $1.2 trillion deficit by the end of his second term. Bush 41? Nope. Reagan? No. Ford? No. Nixon? No. The last Republican president who cut the deficit was Eisenhower. By the way, don’t rush to the comments and blurt that Congress — not the president — is responsible for reducing the deficit. Any six-year-old child who’s watched a Schoolhouse Rock cartoon knows the president signs all legislation before it becomes law, including appropriations bills originating in the House of Representatives. The House can’t magically spend money without a presidential signature. Besides, if the president is to be blamed for the size of the deficit — and the Republicans have been merciless on the president in this area in spite of reality, and their own party’s record — it’s only fair and intellectually honest that he should get credit when the deficit is reduced.
But there’s always something, and expecting the congressional Republicans to acknowledge the administration’s success on the budget is a bridge too far. Instead, the focus is on the debt and repeating a massive dollar value that’s incomprehensible to most people, while never once providing any real context to define exactly why the number is so massive in the first place or, for that matter, what’s being done about it via reductions in the deficit. One thing modern history has taught us is that the Democratic Party would do well to steal back the “fiscal responsibility” title and make it their own. The Republicans don’t really deserve it. Actually, judging by the House GOP’s behavior for the last two years, they don’t really deserve much of anything — other than to be booted out of Congress next year.