Paul Ryan is off and running. Ryan is blaming Obama for 'the Largest Deficit in History.'
Such a charge should not go unanswered. Paul Ryan needs a refresher course on 'Recent America History.' A course that goes back to the actual source of the Deficit problem.
How the Deficit Got This Big
by Teresa Tritch, Editoral, NYTimes -- July 23, 2011
[...]
The second graph shows that under Mr. Bush, tax cuts and war spending were the biggest policy drivers of the swing from projected surpluses to deficits from 2002 to 2009. Budget estimates that didn’t foresee the recessions in 2001 and in 2008 and 2009 also contributed to deficits. Mr. Obama’s policies, taken out to 2017, add to deficits, but not by nearly as much.
A few lessons can be drawn from the numbers. First, the Bush tax cuts have had a huge damaging effect. If all of them expired as scheduled at the end of 2012, future deficits would be cut by about half, to sustainable levels. Second, a healthy budget requires a healthy economy; recessions wreak havoc by reducing tax revenue. Government has to spur demand and create jobs in a deep downturn, even though doing so worsens the deficit in the short run. Third, spending cuts alone will not close the gap. The chronic revenue shortfalls from serial tax cuts are simply too deep to fill with spending cuts alone. Taxes have to go up.
[...]
SOOO ... How exactly did the Deficit get so Off-the-Books BIG?
First blame the Bush Tax Cuts for the National Deficit. (1,812B)
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Then after that blame the Bush Pre-emptive Wars for the National Deficit. (1,469B)
Then after that blame the Bush TARP Bailout for the National Deficit. (773B)
That is what 'Recent American History' shows ...
And as the non-partisan CBO puts it like so, the "largest single contributor to that Deficit, namely" is ...
The Chart That Should Accompany All Discussions of the Debt Ceiling
by James Fallows, The Atlantic -- Jul 25 2011
[...]
It's based on data from the Congressional Budget Office and the Center on Budget and Policy Priorities. Its significance is not partisan (who's "to blame" for the deficit) but intellectual. It demonstrates the utter incoherence of being very concerned about a structural federal deficit but ruling out of consideration the policy that was largest single contributor to that deficit, namely the Bush-era tax cuts.
An additional significance of the chart: it identifies policy changes, the things over which Congress and Administration have some control, as opposed to largely external shocks -- like the repercussions of the 9/11 attacks or the deep worldwide recession following the 2008 financial crisis. Those external events make a big difference in the deficit, and they are the major reason why deficits have increased faster in absolute terms during Obama's first two years than during the last two under Bush. (In a recession, tax revenues plunge, and government spending goes up -- partly because of automatic programs like unemployment insurance, and partly in a deliberate attempt to keep the recession from getting worse.) If you want, you could even put the spending for wars in Iraq and Afghanistan in this category: those were policy choices, but right or wrong they came in response to an external shock.
The point is that governments can respond to but not control external shocks. That's why we call them "shocks." Governments can control their policies. And the policy that did the most to magnify future deficits is the Bush-era tax cuts. [...]
SO, let me reiterate that ...
The policy that was largest single contributor to that deficit, namely the Bush-era tax cuts.
...
And the policy that did the most to magnify future deficits is the Bush-era tax cuts.
SOOO ... How exactly did the Deficit get so
Off-the-Books BIG?
Two words: Blame Bush. (And his "Off-Budget" books.)
Sixteen more words:
Blame the Republicans who signed those W-checks -- with No Plan to actually pay for them.