“First of all, when I hear that from folks who presided over a doubling of the national debt, then, you know, I just want them to not engage in some revisionist history.” – President Barack Obama, February 9, 2009
President Barack Obama has recently begun denigrating Republican attempts to pare back the bloated “stimulus” bill by asserting that a party which oversaw a large increase in the national debt has no business lecturing anyone on fiscal responsibility.
It is true that, between 2002 and 2009, the budgets largely shaped by President George Bush will have run cumulative budget deficits of $3.35 trillion. This calculation credits the entire 2009 budget deficit and TARP costs to Bush , even though Obama will have signed most of the discretionary spending bills and overseen much of the TARP spending.
But Obama does not have much high ground. The “stimulus” bill alone will create more debt (approximately $1 trillion including interest costs), than Bush’s first three years of budget deficits combined ($948 billion). And adding the “stimulus” bill to a realistic budget baseline yields a projected 2010-2017 cumulative budget deficit of $8.4 trillion. – 2.5 times the size of President Bush’s deficits over the same 8-year time period.
Of course, Bush inherited a better economy than Obama (although the 9/11 attacks and the 2001 recession did present budgetary challenges). However, governing is about making choices, and Obama has not yet shown any more stomach for deficit reduction than Bush did.
The logic seems to be that if a Republican President can run up $3.35 trillion in debt, then Obama should be given free rein to run up even greater debt. This is absurd. First, Obama pledged to fix what he considers Republican governing errors – not double down on them. Second, the permanent $1 trillion budget deficits America is currently facing call for a tougher approach than the $150 billion to $450 billion deficits that typified the last eight years. Finally, many Republicans blame themselves for supporting too much deficit spending under Bush, and now believe that spending should be restrained to fix those deficits. Should they be criticized for coming around to this position? Would the President prefer that Republicans continue to argue that deficits never matter?
Presidents need to craft policies that address current challenges. Over two years, Washington is set to borrow a staggering $3.5 trillion from a shrinking global savings pool. This could raise interest rates, worsen the recession, and dump $30,000 per household of new debt into the laps of our children and grandchildren. Any justifications for such borrowing should be on the merits of the current economic situation and not on the mistakes made by the previous administration.