The truth about the US deficit and debt of the last 12 years

[swansont]

Interesting analysis

 

http://davidbrin.blogspot.com/2012/10/eight-causes-of-deficit-fiscal-cliff.html

 

I like how he crystalizes the analysis: we had a budget surplus under Clinton. So we need to look at what changed.

 

The 2009 budget, Bush's last, had a deficit projection of $400 million, but a revenue shortfall of $600 million, for a $1 trillion total, adding to the debt from various actions that were not paid for: wars, Medicare part D, and tax cuts. The actual deficit came in higher; there are appropriations that happened during the year. But that's the baseline for the deficit that Obama inherited.

 

There's also the interesting observation that part of the longer-term economic issues hurting revenue is from a lack of support of science and technology, stemming from the Republican war on science.

[ecoli]

Interesting analysis

 

http://davidbrin.blogspot.com/2012/10/eight-causes-of-deficit-fiscal-cliff.html

 

I like how he crystalizes the analysis: we had a budget surplus under Clinton. So we need to look at what changed.

 

Amoung other things, a giant tech bubble that occurred during Clinton's reign popped during Bush's. Of course, this happened in a vacuum of other expansions of the federal budget (which Bush does have responsibility for), but Clinton usually gets way too much credit for having a balanced budget during his office, considering the budget surplus of 2.4% of GDP was completely unexpected by the CBO - so you can probably discredit any of Clinton's policies for growing the economy.

 

http://my.firedoglake.com/deanbaker/2012/09/09/clintons-surpluses-were-due-to-the-stock-bubble/

 

 

Oh and remind me who signed the repeal of Glass-Steagel again before the Clinton love fest starts?

 

Furthermore, the national debt did not decrease at all during the Clinton era.. while public debt went down (again largely due to the tech bubble) intragovernment debt did not. In this case, revenue from social security taxes exceeded payments so SS had to, by law, buy treasury bonds with the surplus. This caused the deficit to decrease (but never did the national debt go down) but when the bubble burst, the treasury couldn't pay back the social security fund. Which I suspect largely erased the gains from the bubble.

 

You'll notice that none of this was Clinton's policy. Probably his tax hikes helped with the deficit, but ultimately not with paying down the debt.

[Phi for All]

I think some of our biggest problems have come from allowing businessmen to run the country, which isn't as much of a partisan issue. Commerce is essential, but government as a whole is probably not meant to be run like a business. They have many similar traits, but their goals aren't always in alignment. And letting businessmen affect the laws that affect business is just a recipe for Corporate Muffins (you know, the ones where the wealthy get the delicious top parts and leave all the torn, burnt stumps stuck to the pan for the rest of us to scrape out).

 

Oh and remind me who signed the repeal of Glass-Steagel again before the Clinton love fest starts?

I consider the Telecommunications Act of 1996 to be a much more insidious Clinton giveaway. Like Obama, Clinton's biggest mistakes were in what he was willing to give up to get what he wanted. But at least Clinton knew how to play hardball when it came to the BS debt ceiling bluster the Republicans pulled on him yet got away with under Obama.

 

 

 

Edit to add: OK, I finished the article, and I have to say I like the summation. Too much of what the GOP has been doing lately is stonewalling ideas that they would have loved if it hadn't come from Obama. I remember listing a whole bunch of bills in another thread that were practically Republican platform pieces but got shot down because they came from liberal sources that Obama could have pointed to come election time. Personally, I think this goes beyond stubbornness or obstructionism. In a time when whole countries are in dire trouble economically and face vulnerabilities from extremist groups eager to take advantage of any weakness, this insane blockade of logic to further party politics at the expense of the country as a whole is akin to treason, imo.

 

I don't know which part of the GOP to blame for the rest of what they're doing. Is the witch hunt against science due to big business special interests afraid of what the AGW debate will bring to light, or is it the religious right who hate it when science has facts to counter faith? Is this insane warmongering due mostly to an increasingly conservative attitude that lashes out from fear, or is it more big business dealings from lucrative arms and "democracy building" efforts? Are the tax gifts to the rich just an example of how powerful the spin has become now that the media is fully in the control of what we're fed both physically and intellectually, or are there really that many of the rest of us who think keeping the wealthy happier will make the crumbs that fall from their tables bigger?

Edited October 24, 2012 by Phi for All
added thoughts

[ecoli]

Phi - it's just a narrative they [politicians in general] have to keep going so that they keep getting reelected.

[swansont]

It's not a Clinton love-fest, and Clinton's policies have nothing to do with two unfunded wars, unfunded Medicare-D and unfunded tax cuts. If the deficit line gets drawn at another level, like $100 billion, fine, but Bush still increased the deficit by spending money he didn't have and also had his own bubble (real estate) but couldn't leverage that into a shrinking deficit. You measure the performance by what you inherited, not from zero.

[ralfy]

The U.S. total debt and deficit are due ultimately to the use of the dollar as a world currency. We can see this in light of the ff. points:

 

The U.S. moved away from the gold standard because it had to create more credit to support police action in Vietnam, and that in turn was likely connected to the need to secure resources in Indochina and to block Communists. The peak in domestic oil production also did not help. To counter this, the U.S. formed agreements with Saudi Arabia and other OPEC members, leading to the rise of the petro-dollar.

 

Not surprisingly, one trade deficit after another followed from the early 1970s onward.

 

Reagan's reaction was to embark on increased borrowing and spending made possible through deregulation. The result was increased borrowing and spending across the board--government, corporations, households--from 1981 to the present.

 

The military and covert activity were used to prop up the petro-dollar by blocking other countries that wanted to move away from it, including Iraq and Libya, and now Iran.

 

Citizens supported this arrangement--war costs passed on to national debt, easy credit from banks, deregulation allowing Wall Street to profit, and tax cuts--by voting for one administration after another that promoted the same scheme: use the military to prop up the petro-dollar and encourage borrowing and spending, especially given an economy partly dependent on consumer spending and even war costs partly funded by foreign loans. Meanwhile, the government continued to work for Wall Street.

[D H]

Too much of what the GOP has been doing lately is stonewalling ideas that they would have loved if it hadn't come from Obama.

Yep.

 

Obamacare, cap and trade, immigration reform: All of these were originally Republican ideas, and all of them suddenly became evil when Democrats decided to embrace these Republican ideas as their own. Obamacare suddenly became evil when the Democrats pounced on it as a compromise vehicle to achieve something they've been after for decades. Cap and trade similarly suddenly became evil when Democrats saw it as a smart way to address some of the causes of global warming. Finally, immigration reform. Centrist Democrats prevailed over their extreme elements who were against immigration reform.

 

One big difference between Democrats and Republicans is that the Democrats, at least lately, have been able to hold their extreme elements in check. The Democrats try not to let ideology rule over common sense and reality. That's not the case with the Republicans, who instead went on a whole slew of RINO hunting expeditions. There is no common sense left in that party.

[ParanoiA]

Obamacare, cap and trade, immigration reform: All of these were originally Republican ideas, and all of them suddenly became evil when Democrats decided to embrace these Republican ideas as their own. Obamacare suddenly became evil when the Democrats pounced on it as a compromise vehicle to achieve something they've been after for decades. Cap and trade similarly suddenly became evil when Democrats saw it as a smart way to address some of the causes of global warming. Finally, immigration reform. Centrist Democrats prevailed over their extreme elements who were against immigration reform.

 

No contention here, but I'm curious about the claim these were republican ideas. When was Obamacare or cap and trade ever part of the republican ideology? Could you elaborate on that? Immigration reform has been their major issue, however I doubt very seriously their idea of reform resembled democrat's ideas of reform. Just the title phrase is shared.

 

One big difference between Democrats and Republicans is that the Democrats, at least lately, have been able to hold their extreme elements in check. The Democrats try not to let ideology rule over common sense and reality. That's not the case with the Republicans, who instead went on a whole slew of RINO hunting expeditions. There is no common sense left in that party.

 

I'm always amused by this notion of extreme. The republican party is far from extreme. They are devoted central planning federalist big spenders of slightly different stripe than their demoncrat siblings. They say "states rights" on about, what, 3 issues? Romney had to pretend like he had a different foreign policy than Obama and no one could figure out what was different about it. They spend like demoncrats want to, and aside from taxes they mostly just argue about god and abortion. They love regulating the happiness right out of their fellow man as much as their tyrannical liberal counterparts.

 

No, they aren't extreme at all, and largly becoming irrelevant. Demoncrats might even enjoy a resurge in libertarian voters for a bit, who knows. I would like to see Rand Paul take over the party and give us an actual governing difference.

[swansont]

No contention here, but I'm curious about the claim these were republican ideas. When was Obamacare or cap and trade ever part of the republican ideology? Could you elaborate on that? Immigration reform has been their major issue, however I doubt very seriously their idea of reform resembled democrat's ideas of reform. Just the title phrase is shared.

The individual mandate was proposed by John Chafee (R-RI) in 1993, with 18 co-sponsors, including Senate Minority Leader Bob Dole. And Obamacare was modeled on Romney's plan, and remember, he was deeply conservative governor.

 

Cap-and-trade for pollution was part of the Clean Air Act of 1990 under GHW Bush, and it worked/works, both environmentally and economically.

[D H]

No contention here, but I'm curious about the claim these were republican ideas. When was Obamacare or cap and trade ever part of the republican ideology? Could you elaborate on that?

Obamacare started as a Heritage Foundation idea: See http://www.heritage.org/research/lecture/assuring-affordable-health-care-for-all-americans. You can't get any more conservative than the Heritage Foundation. Cap and trade started with the 2000 Bush campaign as an alternative to the much more onerous ideas floated by the Democrats at that time.

 

 

I'm always amused by this notion of extreme. The republican party is far from extreme.

That's only because you are perhaps extremely extreme? The Republicans need to dump their Ron Paul faction and their religious right faction. The Tea Party has ruined the Republican Party. The sooner the Republicans split from the Tea Party, the better. The Tea Party had their brief populist moment in the Sun, and that Sun has set.

[John Cuthber]

 

I'm always amused by this notion of extreme. The republican party is far from extreme. They are devoted central planning federalist big spenders of slightly different stripe than their demoncrat siblings. They say "states rights" on about, what, 3 issues? Romney had to pretend like he had a different foreign policy than Obama and no one could figure out what was different about it. They spend like demoncrats want to, and aside from taxes they mostly just argue about god and abortion. They love regulating the happiness right out of their fellow man as much as their tyrannical liberal counterparts.

 

No, they aren't extreme at all, and largly becoming irrelevant. Demoncrats might even enjoy a resurge in libertarian voters for a bit, who knows. I would like to see Rand Paul take over the party and give us an actual governing difference.

The republicans are extreme.

It's just that the democrats are fairly extreme right wing too, so it's hard to see the difference.

[Phi for All]

The Republicans need to dump their Ron Paul faction and their religious right faction. The Tea Party has ruined the Republican Party. The sooner the Republicans split from the Tea Party, the better. The Tea Party had their brief populist moment in the Sun, and that Sun has set.

Amen to that! Too many people jumped on that wagon without checking credentials every time the driver changed. They thought this was finally some representation that differed from the major parties while still being Republican and shifted their identities, which made it difficult to stop defending the crazy as it got even more crazy. The people I know who claimed Tea Party affiliation two years ago just don't want to talk about it now, like survivors of a hostage situation.

 

The religious right are going to be a bit more difficult to dump. They're going to have to ease away without offending a base that seems determined to block all progress and hamstring US development. That's going to hurt us every time we try to compete globally, and since the religious right tends to dismiss what happens in other countries, I see isolationism in our future if the Republicans don't try to remove the most extreme from their leadership.

[ParanoiA]

Obamacare started as a Heritage Foundation idea: See http://www.heritage....r-all-americans. You can't get any more conservative than the Heritage Foundation. Cap and trade started with the 2000 Bush campaign as an alternative to the much more onerous ideas floated by the Democrats at that time.

 

Not sure I can get on board with cap and trade as a republican idea, since it sounds more like a compromise to something they felt was more insidious. But wow, the Obamacare bit. I shouldn't be surprised, but I still am. Yeah, Heritage Foundation is about as conservative as you get.

 

That's only because you are perhaps extremely extreme? The Republicans need to dump their Ron Paul faction and their religious right faction. The Tea Party has ruined the Republican Party. The sooner the Republicans split from the Tea Party, the better. The Tea Party had their brief populist moment in the Sun, and that Sun has set.

 

Yeah I am quite sure classcial liberalism is viewed as extreme by tyrannical democracy asshats that regulate the living shit out of each other. No surprise there. I wear my tolerance for your freedoms as a badge of honor. Even if you deny mine. The day will come however, when I quit taking orders from the American pigs that have taken 2.3 billion acres of land they cannot wholly occupy, or use, and then procede to tell me how to live cuz I was born in their dumb little perimeter. Go ahead, lecture me on moral and ethics and tell me how extreme it *isn't* to invent laws to preempt the choices of over 300 million people - and the billions in posterity. Why? Cuz your slave owning forefathers planted a flag? Give me a break.

 

Tell me how extreme it *isn't* to assume no American of the 300 million, nor any American born in the next hundred years could possibly have an opinion that would trump yours. To deny even the possibility that you could be wrong about your beliefs and intentions forced onto others. That's what laws are. They make the assumption, that we don't need to hear you to know you're wrong. There is nothing anybody is going to tell us, now or in the future that is going to prove this logic wrong - and we don't even need to hear you to verify that.

 

Talk about hubris. And extreme. You'd think with those kinds of assumptions you'd have small list of laws. But no...thousands upon thousands..so many the federal government cannot give us a quantity. *That* is extreme. Thousands upon thousands of documents pruning, abridging, editing, narrowing, removing choice after choice after choice...until we are all exactly the same. How fucking boring.

 

Yes, I'm just sure this is how we get happiness. Beat everyone into it. Yeah, that's real moderate...of course it feels that way, when you are raised and conditioned in it, taught how to judge and regulate each other from day you were born. I'm not surprised. Most people cannot challenge the assumptions that have defined their lives, as they are inferior to such humility.

 

 

The Tea Party got screwed by Fox News neo-cons very early in the movement. I jumped ship the moment I saw Neil Cavuto at a Tea Party Rally. Hello Neil, the movement was anti-conservative and anti-liberal. It was anti-status quo, very libertarian envisioned but pragmatically aimed at tax and spending. It was great...for about 2 days. Since then, I don't know how it happened, but they've been invaded, hijacked, marginalized, defamed...all at once. You had "tea partiers" making fools of themselves on TV, obvious fox news conservatives trying to pretend like they're mad at republicans. Please...

 

No, we need a slow, steady, sustained philosophical shift in the republican party (since 3rd party is out). A Rand Paul revolution that is thoughtful and deliberate. Someone to protect me from you. Someone to stop you from ruining the only life I get. Someone to stop your rationalizations, push you back to regulate your own life and stop hogging the rest of ours.

 

Someone to inform you that D H, just because I was born..uh, near you, doesn't obligate me to you, nor do I have any responsbility to you. Someone to let you know, that voluntary cooperation is all we are interested in, and that your overbearing, creepy invasion of my personal space will not be tolerated.