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In his friday meeting with House Republicans, President Obama made the following statement:
"The fact of the matter is, is that when we came into office, the deficit was $1.3 trillion. $1.3 trillion. So — so when you say that suddenly I've got a monthly budget that is higher than the annual — or a monthly deficit that's higher than the annual deficit left by Republicans, that's factually just not true, and you know it's not true. And what is true is that we came in already with a $1.3 trillion deficit before I had passed any law. What is true is, we came in with $8 trillion worth of debt over the next decade. It had nothing to do with anything that we had done. It had to do with the fact that in 2000, when there was a budget surplus of $200 billion, you had a Republican administration and a Republican Congress, and we had two tax cuts that weren't paid for, you had a prescription drug plan — the biggest entitlement plan, by the way, in several decades — that was passed, without it being paid for, you had two wars that were done through supplementals, and then you had $3 trillion projected because of the lost revenue of this recession. That's $8 trillion. Now, we increased it by $1 trillion because of the spending that we had to make on the stimulus.
Democrats are absolutely giddy with excitement over the above Obama claims. They think Obama the GOP slayer has set the record straight. I am, however, more than happy to fact-check the President's claims here, because a lot of them are either wrong or misleading.
Let's start with that alleged $200 billion surplus Clinton left in 2000.
It never happened. I know most of you probably think it did happen, but it didn't. It was a budgetary trick, a gimmick. Clinton did come close to balancing the budget with his Republican Congress, but there was never a surplus. I addressed this misconception in a previous post. The federal debt actually increased by $17.9 billion in 2000. That's a DEFICIT, not a surplus.
Next, let's address the unbelievably inane Democratic talking point that the Clinton administration left us on a path for budget surpluses for the next decade, which Bush came along and ruined single-handedly.
Those imaginary surpluses of 2000 were gone the very next year, in 2001. Remember, fiscal year 2001 budgeting was done by the Clinton administration and Clinton's Republican Congress (the federal government's fiscal year runs from October 1st to September 30th). When Bush entered office, he inherited a recession too, mostly due to the dot-com bust, later worsened by the after-effects of 9/11. Neither of those events were caused by Bush. There were never going to be any ten-year surpluses. Reality intervened. All Democrats, including Obama, tell us now that deficit spending is peachy-keen and necessary to fix a bad economy, and Bush did his part by enacting his 2001 tax cuts. Somehow, Democrats didn't agree so much then as they do now. Here's how the NY Times described it in May, 2001:
Congress gave final approval today to the biggest tax cut in a generation, voting to reduce all income tax rates over the next five years and to give the weakened economy a quick jolt by sending rebates to taxpayers this summer.
Following 9/11, we had the Afghanistan war, which EVERY SINGLE DEMOCRAT IN THE SENATE VOTED FOR. The Afghanistan AUMF passed the Senate by a vote of 98-0. That spending came from EVERYONE, not just Bush. Later, came the Iraq AUMF. Democrats in the Senate SUPPORTED that war, by a margin of 29-21. The Senate at that time consisted of 49 Republicans, 50 Democrats, and 1 Independent. It was not controlled by the Republicans. Democrats voted FOR the spending for both wars.
Now, let's move on to the Bush era deficits. This is pretty interesting too.
2002 deficit: $157.8 billion
2003 deficit: $377.6 billion
2004 deficit: $412.7 billion
2005 deficit: $318.3 billion
2006 deficit: $248.2 billion
2007 deficit: $160.7 billion
2008 deficit: $460 billion
2009 deficit: $1.42 trillion
I think we have to look back on those Bush deficits, with the exception of 2009, as the good old days, relatively speaking, no ? It even looks like Bush was heading for a balanced budget, with the deficits dropping in 2005, 2006, and 2007 (and with two wars going, two Bush tax cuts, and Medicare Part D implemented, no less), until the housing sector imploded. Now we have $1 trillion+ deficits projected as far as the eye can see. And if I argued like liberals do, I'd point out that the two largest Bush-era deficits came after the Democrats took over singular command of Congress, and that those two deficits under Democratic leadership were far greater than the previous six years of Bush deficits combined. I might even point out that Barack Obama was in the Senate then, and voted for every budget and spending proposal.
The CBO tells us why the deficit increased so much from 2008 to 2009. From Wikipedia:
The CBO reported in October 2009 reasons for the difference between the 2008 and 2009 deficits, which were approximately $460 billion and $1,410 billion, respectively. Key categories of changes included: tax receipt declines of $320 billion due to the effects of the recession and another $100 billion due to tax cuts in the stimulus bill (the American Recovery and Reinvestment Act or ARRA); $245 billion for the Troubled Asset Relief Program (TARP) and other bailout efforts; $100 billion in additional spending for ARRA; and another $185 billion due to increases in primary budget categories such as Medicare, Medicaid, unemployment insurance, Social Security, and Defense.
You can't blame any politician for revenue drops during the recession, although Obama tried to in his statement that kicked off this post, by acting like he inherited a $3 trillion revenue drop from Bush. Let's look at how much revenue was lost before Obama stepped into the White House. Here are the revenue numbers:
FY2007 - $2.568 trillion federal revenue.
FY2008 - $2.524 trillion federal revenue.
FY2009 - $2.105 trillion federal revenue.
From this, we see that revenue peaked at $2.568 trillion before the recession. Then it dropped by $24 billion in 2008 and $419 billion in 2009. That totals $443 billion that you could say was lost prior to Obama stepping into the White House......BUT....Obama passed $288 billion in tax cuts in 2009 as part of his stimulus package, so he's responsible for part of that lost revenue. A good deal of it, actually. I don't see $3 trillion in lost revenue that Obama "inherited" here, do you ? I see more like $155 billion,. Plus, 2008 and 2009 were deflationary years. If I adjusted for inflation, that loss would be even less. As for projecting revenue drops into the future to explain things away, our double-talking President would be well-served to remember whose job it is to address that situation. It's HIS job, along with Congress. So liberals can understand how ridiculous Obama's claim is, imagine if President Bush had said the dot-com bust and 9/11 recession was going to cause him to run up $3 trillion in debt 10 years later. Liberals would have made a laughingstock of Bush if he had said something so stupid, and rightfully so. Obama's claim of inheriting $3 trillion in lost revenue is nothing more than Obama claiming he's not up to doing his job.
Let's look at the deficit increases the politicians could control:
Who implemented the stimulus tax cuts ? Obama and the Democrats.
Who implemented TARP ? Bush, Republicans, and DEMOCRATS. Obama voted FOR it. A greater percentage of Democrats voted for TARP than did Republicans.
The increases in Medicare, Medicaid, unemployment insurance, Social Security, and defense were supported by both parties, including Obama.
I guess Obama thinks he "inherited" deficits that he and his party actively voted FOR. That makes him a dishonest jerk, a synonym for "politician."
Last, let's look at Obama's incredible declaration that $8 trillion in deficits over the next decade are not his responsibility. He claims he inherited those as well, and also claims he only added $1 trillion to the deficit.
Do I even really need to address this fantastic bit of nonsense ? Obama IS THE PRESIDENT OF THE UNITED STATES. He spent tons of money to get the job. His party CONTROLS BOTH HOUSES OF CONGRESS. They can do whatever they want to do, and that includes DEFICIT REDUCTION. I'm sure they'lll get no resistance on that front from Republicans, who've been screaming about deficits from the rafters all year long. Let's look how the federal spending has increased:
FY2002 - $2.011 trillion (first Bush/GOP budget)
FY2007 - $2.729 trillion (last GOP Congressional budget)
FY2008 - $2.983 trillion (Democrat Congressional budget)
FY2009 - $3.518 trillion (Democrat Congressional budget)
FY2010 - $3.83 trillion (Democrat Congressional budget)
What this shows us is that in six years, the GOP-led (or neutral in the Senate) Congress increased spending by about $870 billion in six years (2002-2007). When the Democrats took over Congress, they increased spending by $900 billion in only THREE YEARS (2008-2010). The Democrats are increasing spending over twice as fast as the GOP did, and Obama voted in FAVOR of every one of those budgets. Obama has fixed spending at a rate nearly $1 trillion per year higher going forward than it was only two short years ago, and then he wants to pretend it's someone else's fault. Un-real.
FINDING - Obama is engaging in full-fledged partisan spin. He doesn't even take responsibility for his own votes in the Senate that increased the deficits he now claims he "inherited." He doesn't take responsibility for anything his party voted for during the Bush era. He doesn't take responsibility for his own massive spending increases. All he is admitting to is basically the $862 billion stimulus package, plus a couple other things.
Who does this guy think he's fooling ??? Besides liberals, that is. They LOVE his misdirection. The rest of us know better.
Note to liberals - This was NOT a defense of the Bush administration. Y'all always get confused about that. I was against the Bush deficits, the Iraq War, and the unfunded Medicare Part D too. I don't want to hear any more silly misdirection comments here arguing as if I supported all those things. This was merely a fleshing out of the Democratic and Obaman involvement in things, to shine a little light on the twisting of history that invariably occurs. Our current Prez is a world-class twister. I'm sorry you have to hear that, but unfortunately, it's true. I wish it wasn't.
Update - I just realized I left something important out about Obama's distortions. When Obama said he inherited a $1.3 trillion deficit when he walked in the door in 2009, that included the Bush-era $700 billion TARP spending (that Obama and the Dems voted FOR). What Obama failed to include was that about $500 billion of TARP has been repaid by the banks, reducing the deficit Obama claims he "inherited" to $800 billion. Yet, the 2009 deficit was over $1.4 trillion. Obama nearly doubled the 2009 deficiit, and is raising it even more next year. The man seems incapable of honesty.