It is factually incorrect to say that you have 'grown' a 'deficit' that has not yet even happened or been realized... and is, in fact, nothing yet but a very tentative projection and still subject to many, many future policy and budget choices that have YET TO EVEN BEEN MADE YET.
Not a single Obama budget has yet been submitted. (The *first* Obama administration budget isn't until FY 2010. Same as Bush's first budget wasn't until FY 2002, as per usual for any new President....)
Many, many changes yet to be implemented, (all of which will alter the baseline projections):
Health Care changes (17% of American economy and fastest rising contributor to federal debt) yet to be enacted.
Tax changes (simplification, loophole elimination, whatever) yet to even be proposed.
Pay-As-You-Go rules for future budgets are promised but yet to be approved by Congress.
Range of economic growth coming out of the Great Recession still a great unknown (and one of the VERY LARGEST influences on federal revenue and borrowing).
Energy policy changes, corporate welfare changes, Social Security changes, etc., etc., etc. can all be expected in the next few years >>> rendering all of the current 'projections' moot as baseline numbers change dramatically.
The CBO projection
But... back to that one CBO BUDGET PROJECTION you are talking about, (You know, those 10 year deficit projections that have been talked about so much here and all over the media....)
Has you noticed yet what WASN'T TRUMPETED in the media's coverage?
(And remember... Obama hasn't even had a chance yet to come up with whatever spending reductions he might or might not want to get around to - PAYGO rules for budgeting, etc....)
Well, anyway... CBO's ten year projection of the US's expected deficit says this: the HIGHEST DEFICIT that CBO projects is for this current year, FY 2009. They project a deficit of $1.18 Trillion for this year, and they estimate that EACH YEAR thereafter (the next nine years in their ten year projection) the deficits will be LESS!. (Measured as a percentage of GNP, of course.)
(Note: this is *before* Obama even gets to input any of his deficit reduction policies....)
Put another way what CBO projects is a truly terrible 12% of GNP deficit for this near-Depression FY 2009... falling to 7.9% of GNP next year... and then falling further each additional year.... (Just like President Clinton managed to reduce federal deficits from the terrible deficit baseline that the first President Bush left in his wake, I expect that President Obama will steadily reduce the monstrous structural deficits that the second Bush left behind.)
ON THE OTHER-HAND THOUGH, history is history.
Immutable, inviolate, no longer subject to changes....
And, there, in the historical record, there is some very stark evidence for HOW TO *GROW* FEDERAL DEFICITS INTO REAL MONSTERS:
Presidents and the Federal Debt
White House Data Confirms: Reagan-Bush Administrations
Created Post-WWII Federal Debt
zfacts.com
GRAPH OF DEBT HISTORY SHOWING PRESIDENTS (April 2006 data point --- note that Bush II wound up exceeding even this prediction for his second term. National Debt is up 5.3 Trillion since Bush II became president.)
Contributions of Presidents to the Gross Federal Debt
The Presidential contributions to the gross federal debt are computed from data available from the White House.gov in the Historical Tables, Table 7.1 (PDF), p. 118, for FY 2005. The graph and data are also available in this XLS source file.
For each term in office, the President is responsible for four fiscal year budgets starting Oct. 1 of the year they take office and ending Sept. 30, eight months after they leave office. Table 7.1 gives the gross federal debt as a % of GDP at the end of every fiscal year since 1940. Each President's federal debt contribution was computed by simply subtracting the value at the start of his first FY from the value at the end of his last FY.
All Presidents prior to Reagan contributed to paying off the huge WWII debt. The graph also credits the drop in federal debt as a percent of GDP under Clinton towards repayment of the remaining WWII debt and not towards paying off the Reagan-Bush debt. That would simply hide their impact by making it appear that more of the current federal debt was left over from WWII. Had Reagan-Bush simply managed to break even, the WWII debt would have been as low as it's shown to be.
Debt held by the Federal Reserve System is purchased by printing money; the purpose of these "open market operations" is to put more currency into circulation. The most recent figures used for this part of the federal debt are available from the St. Louis Fed. This was divided by GDP figures provided by the Department of Commerce.
Since all Presidents from Truman on have reduced the gross federal debt except Reagan and the Bushes, the part remaining from WWII is found by subtracting their debt contributions (and the FRS contribution) from the current federal debt total.
Keywords: Federal Debt, National Debt
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Data on National Debt by President
From dKosopedia
dkosopedia.com
There is a similar page on wiki.
The Table
Left Debt Change
Office Years %GDP per Year
R:Bush II 2002 2 59.80 0.90
D:Clinton 2000 8 58.00 -0.76
R:Bush I 1992 4 64.10 3.05
R:Reagan 1988 8 51.90 2.31
D:Carter 1980 4 33.40 -0.70
R:Ford 1976 3 36.20 0.20
R:Nixon 1973 5 35.60 -1.38
D:Johnson 1968 5 42.50 -1.86
D:Kennedy 1963 3 51.80 -1.40
R:Eisenhower 1960 8 56.00 -2.29
D:Truman 1952 74.30
Here's the same data, tightened up, with the three-decades old data discarded, and sorted from best-to-worst:
Change in the National Debt, as a yearly percentage of GDP.
Sorted Best-to-Worst.
D:Clinton -0.76 (reduced the debt)
D:Carter -0.70 (reduced the debt)
R:Ford 0.20 (no change)
R:Bush II 0.90 (increased the debt)
R:Reagan 2.31 (increased the debt)
R:Bush I 3.05 (increased the debt)
Analysis
Notice that fifty years ago, the debt was huge: that's because WWII was very expensive. Afterward, both parties wisely cooperated to pay down the huge war debt. Ford was the first president to break with that tradition. From that point forward, every Republican worked hard to push us deeper into debt, every Democrat worked hard to get us out of debt.
The change in the Republican party that started with Ford is visible in most of the other statistics as well. Check them out.
Methodology
Here's how I compiled this table: I went to the OMB and got the table that shows total government debt for each year starting in 1940. For each president, I wrote down the last year he was in office, and therefore, the last year he had control over the budget. I also wrote down the total debt in that year, as a percent of GDP (I do not know if that was the debt at the start, middle, or end of the year: it doesn't make much difference, since most presidents were in office much longer than that.) I then compared each president's debt level as a percentage of GDP to the level of the president before, calculated the difference, and divided by the number of years in office.
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"How George Bush, Big Spender, Destroyed Nirvana": Kevin Hassett
Commentary by Kevin Hassett
American Enterprise Institute
bloomberg.com
Message 24302947
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Legacy of Deficits Will Constrain Bush's Successor
Soaring Costs Threaten to Impose A Harsh Reality
By MICHAEL M. PHILLIPS and JOHN D. MCKINNON
February 1, 2008; Page A3
online.wsj.com
Message 24273140
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Message 25902563 |
