Yawn.
Obama certainly could have done something. He could have slashed spending and pulled the troops out of both Iraq and Afghanistan, and perhaps increased taxes also. Now, our position in the world would have taken a nosedive, and we would have fallen into a depression, and he would have had to change his name to Herbert Hoover and register as a Republican, but he could have done it. And the then the right would have been happy.
Someone needs to invent a term for illiteracy or innumeracy as applied to economics. I could see a real use for it.
So you’re saying he should default on the current deficit, right? 'Because even if we presume that he has the entire congress completely in lockstep (or that filibusters don’t happen, whichever), we’re still talking about the deficit, not the budget. Unless you’re proposing that he just have a whole lot of money printed to pay everything back?
This is a slight hijack, but I think the political issue the OP has asked has been addressed (or rather has not been rebutted). I admittedly don’t know much about economics, so keep that in mind.
Politics aside (at least in my asking the question), here are CBO projected estimates through 2020. They project* (2010-$1.4t, 11-980b, 12-650, 13-539, 14-475, 15-480ect; they continue on and start to rise slightly to about $600billion/yr through 2020). So, this is seemingly good, cutting trillion plus deficits down to $600billion. Yet on the other side of the coin, 10 years from now we’re still running $600b/yr deficits.
*CBO states these projections are based on current laws/policies and are not intended to be the actual budget deficits (b/c I’m assuming laws and policies will change).
My question is, is there any plan, or is it possible, to have a surplus? Is there at least an optimal deficit to reach? How long can we continue running $600b/yr deficits?
In support of Shodan
You can’t have it both ways. Either Congress spends the money (my opinion) or the do so under the presidents direction. What you CANNOT say is that the current president and/or Congress is powerless and must carry over the fiscal policies of their predecessors. If that’s true then the deficit is not Bush’s fault but FDR’s who got us into the social welfare morass we’re in and Reagan’s for the philsophy of a good defense is a big defense.
The deficit is is caused by Bush tax cuts? Then raise taxes and have Obama sign it. The war? Then invoke the War Powers Act and cut appropriations. The stimulus and TARP? Then don’t spend the rest of the stimulus money. Claiming that the deficit is Bush’s fault and implying that the Dems in Congress and White House can’t do anything about it is disinginuous at best and at worse blatant “Everything you do is bad. Everything we do is good.” mentality
:rubs hands deviously:
You kill the Joe, you make some mo’!
By the way, I know we don’t throw the “t” word around, but he’s getting fat from all the food.
That’s as may be, but it is still informative to look at a certain range of policies and ascertain their role in the deficit. Some people are certainly talking about “Obama’s 1.5T deficit” as if he is solely responsible for it. In one sense he is (or Congress is), in that he (or they) are responsible for the budget in general. In another sense, however, the various policies contributing to the deficit were instituted by various presidents and congresses, and it would be somewhat inconsistent for a Republican partisan to criticize Obama for running a deficit if he were merely staying the course on policies instituted by Republicans. If hypothetically it turned out that the entirety of the deficit were the result of the Small Business Support Program instituted by St. Ronald Reagan, and that repealing that program would be met by opposition that would make the opposition to the health care bill look like mild disapproval, then criticism of the deficit would take on a different light.
Hence the OP, which is asking which policies are responsible for how much of the deficit.
He would have still been black, so no, the Right would not have been happy.
In a severe recession you want big deficits. Consumers and corporations are desperately deleveraging, i.e. reducing spending so it’s logical for government to take up the slack. The US government is fortunate in possessing a tremendous capacity to borrow and the US people are fortunate in possessing an administration which is willing to use that power. This is one of the main reasons why a depression has been avoided.
Of course during normal times you want to run a balanced budget or even a budget surplus so Bush’s deficits still deserve criticism. Not to mention the fact that the policies behind much of the Bush deficits, tax cuts for the top brackets and the Iraq war, didn’t benefit the average American. Apparently however conservatives and some Beltway pundits seem to think it’s just fine running deficits when the economy is growing but when a recession strikes, that’s when the government should tighten its belts. It would be hard to come up with a more perverse and idiotic economic argument.
As noted above, Obama’s policies have contributed relatively little to the long-run deficits but the main point is that deficits right now are good for the economy.
No, he couldn’t. Unilateral withdrawal from the messes we created in Iraq, and to a lesser extent, Afghanistan, would have severely damaged our position in the international community, not to mention leaving two giant power vacuums in a part of the world where we least want them. On review, I see you did actually address this. :smack:
It took more than a year to push through healthcare reform, which had broad support from the voters (at least in the beginning of the process) and which was an integral part of his election platform.
How do you think the Republicans and Blue Dogs would have reacted to a significant across-the-board tax hike? He’s already getting all kinds of crap just for saying he won’t renew the Bush tax cut.
That was a whoosh, RNATB. He was being sarcastic.
Which is why in my post I blame FDR & Reagan (look at the biggest budget items). No, I take that back. Both of them dealt with an unprecedented financial crisis the best way they knew how: FDR, the Depression and Keynesian economics; Reagan, stagflation and supply-side economics. I truly blame the Congresses (doesn’t matter who’s in control) since then treating these fiscal efforts as sacred cows that are somehow relevant decades after the fact. Everytime a president tries to change it (e.g. Bush and privatizing Social Security), he’s fighting a losing battle not because of the proposal but “How dare you change the status quo!”.
My big issue with the “Obama deficit” is the spin his people put on it of “Bush left me a huge deficit.” while Obama increases the deficit. It is getting old and to be honest, if the Dems in the Senate kept getting outvoted 40 to 60 and Obama has Bush causing an increase in the deficit a year after he left office, then I think you should let Nancy (Skeletor) Pelosi run the party 'cause she’s got more balls than Reid or Obama. Anyone who reads my posts (all 3 of you) know I can’t stand Pelosi and I think she’s an abject moron - but right now she seems like the only Dem that can do anything while your majority leader and president wet themselves because of the evil Republicans that secretly run the current government.
Oh crap!!! I think I just complemented Pelosi!! :eek:
Time to start drinking heavily.
Yeah, I sort of figured it out halfway through writing my post, but I didn’t want all that work to go to waste. 
I just forgot to add Shodan’s post as a quote.
Or maybe it’s why the recession has lasted as long as it has!
Or maybe there wouldn’t have been a recession and the deficit spending caused it.
Or maybe the magic hand of the free market would have solved it all.
Think about that for a minute.
It sure would be nice if after running a deficit during a recession the government could run a surplus during an expansion.
Unfortunately, you are wrong. They can, and have, and will.
Pretty much the same thing.
The chart claims that most of the deficits for the next decade or so are the fault of the Bush tax cuts. Assume that is the case. That means that Obama and Congress are helpless pawns of Fate. They cannot possibly do anything about the tax cuts. The magic mind control rays are too powerful.
Regards,
Shodan
My post was patterned after an engineer who was demoing one of our products in our demo room. A potential customer asked about doing something with it, and he answered “you could, but you’d be stupid.” Last time he ever demoed anything. 
I searched for the expiration of the tax cuts. Not renewing them is in the budget, but it is not clear if Congress has the guts to not renew them for the rich. If he doesn’t, this is a good case of Bush’s dishonesty coming back to bit the Pubbies, since the expiration was in there to make the long term impact on the deficit smaller. I guess they never expected to lose control of everything. How can the Republicans object to them following the wishes of a Republican President and Republican Congress.
Despite these, we did have a surplus before Bush came and screwed it up. Part of that came from doing away with some of the Reagan tax cuts. Social Security is not contributing to the deficit, I doubt the TVA is, and I don’t think most of the other programs are still in effect. Plus, the general philosophy was adopted by presidents of both parties. Ike kept it while paying back the WW II debt.
As for Social Security, the privatization effort failed because it was a bad idea, and the more Bush talked about it the worse the poll numbers got. It was all predicated on the notion that the market never goes down over a 10 year period (whoops) and more fundamentally ignoring that higher returns only come with higher risk. How do you think people whose brand new private SS accounts lost half their value would have reacted if it had gotten passed? Disconnecting return from risk in the minds of investors is one of the things that got us into this mess.
You appear not to be comprehending that the reason for the current deficit is not that there aren’t the votes for increasing taxes, but because the financial heap of crap Bush left Obama makes it imprudent to worry about balancing the budget. This really should be obvious.
Gee, sorry it took so long. Do you want me to wait so you can get some popcorn? 
My take: Bush was a fiscally irresponsible, big-spending, big government ‘conservative’. The big deficit in Obama’s first year was an unavoidable combination of Bush’s budgetary screwups and the economic downturn.
Notice I didn’t blame bush’s tax cuts. Deficits are the result of a gap between revenues and expenditures. Automatically blaming a tax cut for a deficit represents a biased viewpoint - you could equally say that the government spent too much money.
In 2000, government spending was 32.56% of GDP. By the end of 2008, government spending was 37.12% of GDP. The fact is, Bush presided over a huge increase in government spending. Had he held government spending to just the rate of growth of GDP, he would have a 251 billion dollar surplus in 2008 instead of a 407 billion dollar deficit. That’s WITH his tax cuts. Had he held government to the size GDP growth throughout both his terms, the deficit would be about 2 trillion dollars smaller as he would have run surpluses throughout almost every year.
But he didn’t. So Obama inherited a horrible fiscal problem. Had Obama done everything I would have wanted (canceled TARP instead of using it as a slush fund once there was no need to buy distressed assets, canceled the stimulus, cut discretionary spending), he’d still have had a huge deficit. No doubt about it. You can’t avoid deficits in major recessions.
Now, Obama is much more to blame for the projections of future deficits going forward. Yes, he inherited a pile of crap, but doesn’t that imply a need to get a shovel and start digging out? He hasn’t done that. In fact, he’s piled on to it in a major way. He’s added a trillion dollars with the health care bill (and that’s a laughingly low number). He’s bumped discretionary spending up by 13.1% in FY2010, an increase of around 150 billion dollars in one year.
I know that sounds like chump change compared to the current deficit, but just three years ago that would be seen as huge money. By 2020, discretionary spending will be about 350 billion dollars per year higher due to Obama’s policies. Obama owns that. He should be cutting discretionary spending, not increasing it. Public union salaries are out of control, and there are agencies like the Department of Education that consume tens of billions of dollars a year and produce no apparent benefit whatsoever.
As of today, perhaps 20-30% of the deficit is Obama’s fault. The rest is the cumulative failing of past presidents, with Bush carrying a greater than average share of the burden. But by 2020, it’s all on Obama. Because it’s each President’s responsibility to govern based on the current facts. You don’t get a pass because someone else screwed up. He was elected because he promised to fix the problems. He doesn’t get to ignore that and just blame others. And the fact is, when the U.S.'s biggest crisis is the explosion of the deficit, Obama has not only done nothing to make that better, he has implemented a raft of new policies that will make the problem worse.
Everyone should commit this graph to memory. This is the freight train heading your way. It could be seen coming since the 1980’s. Several presidents have made attempts to try to stop it (including Bush), and were shot down in flames by the Congress. So the problem has been kicked down the road. But guess what? It can’t be kicked any farther. Obama’s administration is the last one before the crap hits the fan. His sole focus right now should be to put plans in place to deal with this. Instead, he’s creating new social programs, adding new entitlements, and throwing money around willy-nilly.
The health care plan as originally conceived was an attempt to address this problem to some degree. But as is usually with American federal legislation, by the time it was made law all the cost-cutting features were removed and more benefits added, and in the end it makes the problem worse, or at best doesn’t really address it at all.
This year, Social Security and Medicare together cost about 1.1 trillion dollars. Under Obama’s own budgets, by 2020 this cost will have escalated to 2.1 trillion dollars per year. And that’s just the start of the problem. The increase in spending increases faster in the decade between 2020 and 2030.
This is not a problem that can be solved with tax increases. It’s too big for that. The root problem is that you’ve made health care an entitlement at a time when its costs are exploding, and you’ve spent all the money you were supposed to have saved for people’s retirement, and now the bills are coming due.
As far as I can see, the only way to solve this problem is to take harsh steps such as raising the retirement age, cutting Social Security and Medicare benefits, and means-testing all entitlements. Obama has no plans to do that - and in fact his plans to cut Medicare, even if they happen, was merely shifted to close the cost gap of a new entitlement, eliminating the low-hanging fruit as a way to bend the cost curve.
So I expect that this problem will continue to fester, and then explode in the next decade and the real fun will begin.
Depends how big GDP is. GDP will be a lot bigger in 2020 so $600 bil won’t seem like so much. So long as we just stabilise deficit spending and it doesn’t get any worse we’ll just grow our way out of massive deficits. We’ve grown out of much bigger deficit holes before.