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Government spending under Obama, including the
stimulus bill, is rising at a 1.4% annualized pace—
slower than at any time in nearly 60 years. But when
inflation is included, spending is falling.
The standard view is that President Obama has been spending taxpayers' money wildly, like no other president before him. Rex Nutting has put the kibosh on that. In fact, growth in federal spending is the lowest it's been since half a decade before Obama was born:
As would-be president Mitt Romney tells it: “I will lead us out of this debt and spending inferno.”
Almost everyone believes that Obama has presided over a massive increase in federal spending, an “inferno” of spending that threatens our jobs, our businesses and our children’s future. Even Democrats seem to think it’s true.
But it didn’t happen. Although there was a big stimulus bill under Obama, federal spending is rising at the slowest pace since Dwight Eisenhower brought the Korean War to an end in the 1950s.
A key aspect of budgeting often ignored for political conveniency is the fact that the federal fiscal year begins Oct. 1. So by the time Obama stepped into the Oval Office, the budget for fiscal 2009 was already nearly one-third spent and expenditures for the rest of the year locked in. He added about $140 billion to the spending in 2009 through the stimulus plan.
The big surge in federal spending happened in fiscal
2009, before Obama took office.
For the four budget years Obama has had a direct hand in shaping, federal spending is on track to go from $3.52 trillion to $3.58 trillion. On an annual basis, that's 0.4 percent. When those dollars are inflation-adjusted, federal spending will actually have fallen during Obama's first four budgets at an average rate of 1.4 percent. That, Nutting says, is the first real decline since Richard Nixon pulled hundreds of thousands of U.S. troops out of Vietnam 40 years ago.
What's also true, of course, is that revenue hasn't kept up with spending. This is partly due to tax cuts pushed through by George Bush, two wars rushed into by George Bush and a record-busting recession that began on George Bush's watch. The impact of the last includes millions of Americans out of work or working fewer hours, thereby reducing income tax revenues and putting immense pressure on expenditures for food stamps and unemployment insurance benefits.
In per capita terms, Nutting writes, real spending will fall from $11,450 per person in 2009 to $10,900 in 2013 (as gauged with 2009 dollars). That's a 5 percent drop.
It can be argued, and obviously has been from the president's left, that he should have sought more spending to quickly reduce unemployment and take advantage of low borrowing rates to improve America's crumbling infrastructure. That he should have gone on a short-term spending binge as an investment in the future. But those who say he actually did do so are not eager for anyone to look at the data and pop their propaganda balloon.
Originally posted to Meteor Blades on Tue May 22, 2012 at 12:23 PM PDT.