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Wednesday, January 27, 2010
WHO'S the party of fiscal responsibility?!
(Click for full-size)
This graph shows the National Debt, adjuster for inflation to Y2K dollars. It's a modified (only for color) version of what can be found on The National Debt Clock's FAQ. It only goes to 2007, but you KNOW the problem's only gotten worse since then. The Right Wing Media keep hammering THAT home, don't they? And it’s all Obama’s fault, right? Even though we’re only about a month into the FIRST Obama budget, and the budgets for ’08 AND ’09 were in fact singed by George W. Bush! That’s a FACT by the way, not “liberal bias” or “making excuses.” I’ll own up to the deficit from 2010 on, but I won’t take any guff from some blowhard who was silent all through the Bush years, and who thinks that even the 2009 deficit has anything AT ALL to do with President Obama.
There a couple of things about the graph that might need clarifying. First off: Red = Republican Budget, Blue = Democratic Budget. I figured I’d keep that convention. Second, you’ve got to remember that a President ELECTED in Year X, doesn’t start his term until Year X+1 and the budget he passes that year doesn’t take affect until year X+2. So President Kennedy, for example, was elected in 1960, took office in 1961 and his first budget wasn’t in effect until 1962. That’s why you don’t see the first transition to Kennedy's Blue (from Eisenhower’s Red) until ’62, even though he was elected in ’60 and took office in’61. All clear? Good! Now let’s walk through the graph…
The first thing you see is a huge spike in the later Roosevelt years. The cost of the New Deal? LOL, no. That would be the cost of World War II. And it was paid down to a sustainable, strategic debt level within a few years despite another War (Korea) waged by his successor, President Truman. For the most part Truman had a balanced budget, even despite the war, and overall the natinal debt remained constant with a very slight downward trend until his final year in office. Switch to President Eisenhower, a Republican, and you’ve got about the same thing. Pretty consistent debt levels, even a very slight downward trend – and remember: He build a National Highway system! So even given that very New deal-esque / Keynsian stimulus project, he kept his budgets balanced as well. The Kennedy/Johnson years showed much the same thing. Even with the great society progrmas, the National Debt didn’t budge in those years. So far, I’d say both sides are on the same page when it comes to budgets, taxation and spending. (Namely: Pay for what you spend!) And they’re both showing a restrained, but clearly Keynsian approach to managing the economy. (You can point to an expensive governement "project" is every case.)
Now it starts to change a bit in the Nixon/Ford years. Starting here we see the first appreciable up-tick in the National debt since World War II. Nothing extreme, but it does look like they’re starting to feel the combined affects of not only President Johnson’s social programs, but their own taxation policy, the Vietnam War costs, and the beginning of the economic turmoil that would plague us through the 1970’s. One thing that’s really apparent is that in President Nixon’s second term (three years of which were served by President Ford) not only did we have three years in a row that we ran a Federal Budget Deficit for the first time since World War II but each of these deficits were also the largest we’d seen since the War. (This is evident becuase at no other previous time do we see as large an increase in the National Debt.)
Now… Given what was going on in the 1970’s, I don’t mean this as a swipe against Presidents Nixon and Ford. Truth be told, I don’t think either was actually a bad President. The more I read about Richard Nixon the more I despise the man, but the more I admire the President. There’s very little you can point to policy-wise to criticize, either in terms of foreign or domestic policy. (I’m not too crazy about his Supreme Court nominees, but hey: I AM a liberal, after all!) But I seriously don’t have any problem with the fact that they ran deficits. I’m a KEYNSIAN! And if you understand Keynes, you’ll understand that running a deficit in a recession (which pretty much describes most or all of the 1970’s! LOL) is no vice. I only point it out because the only people I hear harping on the deficit are REPUBLICANS, and even then only when DEMOCRATS are in office! But up to this point, there is no evidence to support that Democrats even really RUN deficits. I know, I know: It was a long time ago. Things are different t know. Yeah, they’re a lot worse… for REPUBLICANS!
Moving on, President Carter fits the mold, both for the Democrats being the ones to show fiscal restraint, and in support of the Keynsian model of economics. His budgets were wither balanced or ran a surplus, and yet the economy still taked. What does this show you? In addition to bolstering the Democrats as the one who know how to balance a budget, it also shows that a balanced budget doesn’t give you economic success. It as Keynes predicted: In bad times you HAVE to run deficits! You increase spending to stimulate the economy, and you worry about the budget only once things are on good footing again. Cutting spending HURTS. And it hurts even more than raising taxes does in terms of people incomes. So President Carter had the wrong plan at the wrong time… just like the deficit hawks (meaning Tea-Bag Conservatives) do NOW. But starting in 1982, the first year that a REAGAN budget was in effect… everything goes totally cattywampus.
Why the hell do these tea-baggers hold up Ronald Wilson Reagan as their idol? If they had any clue at all they should DEPSISE THE MAN! And George Herbert Walker Bush as well! Check it out… Every single year of the Reagan-Bush administration we ran a deficit. Every. Single. Year. TWELVE YEARS IN A ROW! Recession or Boom-times... It didn’t matter! Talk about runaway spending! Talk about out-of-control government! And not only did they RUN deficits, but they ran HUGE deficits! Every year the deficit was bigger than it had been in any year between Wordl War II and when they took office! I don’t have the exact number, but judging form that graph I’d say at least TWICE as big! Imagine that: Twelve years in a row of running a deficit that DOUBLED the previous record, adjusted for inflation, and these poeple still claim credability on fiscal matter! Their audacity in makig that claim is surpasssed only by the ignorance of their supporters who believe it.
And I’ll reiterate: I’m not necessarily trying to take a swipe a Reagan here! I found Reagan to be an inspiring leader, even if I did find his policies lacking. And I actually really liked George Bush, the elder. I’d have voted for him twice, had I’d been registered to vote at the time. So again: This is not MY criticism. It just shows that if the National Debt is your chief concern, maybe you shouldn’t idolize the guys who brought it from just under 2 Trillion Dollars (in Y2000 dollars, remember!) in 1981 to over 5 Trillion dollars in 1993. A twelve year trend of record deficits that increased the National Debt over two and half times and yet somehow these people can still claim “fiscal restraint” with a strait face. Unbelievable.
Oh… it gets even worse for them!
Once Bill Clinton comes into office, we immendiate see a DECREASE in the deficit. IMMEDIATELY. (Notice how the increase in the Debt is about half what it was in even the best year under Reagan or Bush’41?) And even so, if you were around at the time, you’d still have heard Rush Limbaugh, back in his early days, ranting in tirades about how Clinton’s ruining the country, taxing the hell out of us, running deficits… (See? They were blithering hypocrites even back then!) And yet, we not only had eight strait years of GROWTH under President Clinton, but by the end we saw a balanced budget, followed by TWO years of budget surplus. So again… WHO’S THE PARTY THAT HAS FISCAL RESPONSIBILITY?! (And to anyone who would ask why he could have that surplus immediately, it just goes to show how bad thjings were under Reagan/Bush. The spendign cuts and tax increases that were needed would have destroyed the economy had they gone it all at once. At that point we were pretty much addicted to gov't spending and had to weened off slowly. (And HOW MANY times od we here that it's the DEMCRATS that want to make people dependant on the government?!)
Oh… it gets even worse for them!
George W. Bush. The all-time heavyweight champion of drunken-sailor-like fiscial irresponsibility. Think about it: The man was handed a budget surplus, with low interest rates and a strong economy. Allhe had to do to keep a balanced budget, a suplus, actually, and continue to pay down the national debt was... NOTHING AT ALL! And within ONE YEAR he turned a record surplus into a record deficit! And that’s before the War in Afghanistan even started, let alone Iraq! What’s more, neither war was ever actually IN his regular budgets. Even several years in, he was still funding them with “emergency spending” bills. This was a gimmick to make his budgets look better, and his deficits smaller, but the effect on the National Debt is still the same. Deficit spending is deficit spending, after all. So he’s right back on the Reagn/Bush’41 path. He didn’t even raise taxes to fight his wars! It’s absurd! EVERYONE raises taxes to fight wars! (And THAT was also before TARP, the Auto bailout, the Stimulus, etc…)
Which brings us to President Obama. And here we go again, with the Right complaining about Obama, and the deficit. The claim he’s “tripled the deficit.” This is a LIE however, because his budget INCLUDES the war finding up front, rather than playing Bush’s childish game of “hide the salami” with it. In truth, his budget deficit is up something on the order on 20-30%. A modest increase only, and certainly on par with what we saw during the Reagan/Bush’41 and Bush’43 years. (When these same clowns were silent about it.)
Now remember… and it bears repeating… I don’t think Bush'43 was wrong to do TARP, the Auto Bailouts or the first stimulus. Nor do I think Obama was wrong to continue these policies or pass his own stimulus. I’m a keynsian, and I aced Macroeconomics in grad school, and I KNOW how these things work. These things were NECESSARY. So again, in and of itself, I am not trying to criticise Republicans or praise Democrats here. I’ve expressed admiration for both Reagan and Bush’41 and I’ve said before that I was never really a fan of Bill Clinton's. I do despise George W. Bush, I’ve made no secret about that, but overall I don’t want this to come off as a purely partisan hit piece. That’s NOT the point here.
The point, and what need to be taken away from all this, is that if you are concerned about the National Debt, and the annual Budget Deficits, whether you are a tea-bagger or not, there is NO EVEIDENCE, at all, going back almost 40 years, that the REPUBLICANS are the ones who show fiscal responsibility, and the DEMOCRATS are the ones who spend willy-nilly. If anything this is a swipe at the ignorant tea-baggers who are so angry, but have been brain-washed by the very people who caused the problem into blaming it on the only ones who've shown any interest in fixing it! If these tea-baggers had any brains at all, they be voting for DEMOCRATS, in droves!
But hey, since when has the media ever let FACTS get in the way of promoting Right-Wing propaganda?
Coming next… WHY the Republicans keep doing this, and why they’ll NEVER stop!