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Why Bush Isn’t Responsible for Today’s Debt Crisis

Posted By Mike Brownfield On April 17, 2012 @ 2:56 pm In Featured | Comments Disabled

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We get it, the last thing President Obama wants is to be blamed for is the nation’s growing debt—or anything else, actually. But the statute of limitations on blaming President George W. Bush for everything—anything—must have run out by now.  On the debt in particular, it’s sort of a hard thing to avoid considering President Obama is the first president in history to preside over four years of deficits in excess of $1 trillion.

But in the time honored tradition of the Obama Administration, Treasury Secretary Tim Geithner took to the Sunday talk shows to wrongly lay the blame for the country’s massive debt squarely at the feet of President Bush. Geithner, however, overlooks the truth and ignores just how much deeper in debt President Obama’s failed leadership will leave America in the future.

Speaking on Meet the Press, Geithner claimed [2] that “The vast bulk of the increase in debt is a result of the policy choices made by [Obama's] predecessor to finance very expensive tax cuts by borrowing, to finance two wars by borrowing, finance a big expansion of Medicare by borrowing, not cutting other spending or raising taxes. That’s the bulk of the contribution.” And of course, Geithner says that Obama is blameless, arguing that his policies “caused only about 12%, a very small fraction of the increase in debt you’ve seen over this period of time.”

First thing’s first: Are President Bush’s policies to blame for today’s debt? Quite simply, no.

Tax cuts of 2001 and 2003:

The left has blamed the Bush tax cuts for wiping out a $5.6 trillion surplus, leaving America with “deficits as far as the eye can see.” That surplus, though, never existed.

According to Heritage research [3], the Congressional Budget Office (CBO) projected that surplus in January 2001 based on the assumption that the economy would keep growing at the late 1990s rate, that the stock market bubble would continue and generate record revenues, and that there would be no recessions, terrorist attacks or natural disasters, and that all discretionary spending would fall to 1930s levels.

Those assumptions, as we now know, were miles off target, and the anticipated surplus never materialized. From the years 2002 to 2011, the United States ran a deficit of about $6.1 trillion — an $11.7 trillion swing from what CBO projected. At a cost of $1.7 trillion, the Bush tax cuts only account for 14% of that amount. Blaming those tax cuts for today’s debt just doesn’t add up.

The Wars in Iraq and Afghanistan and the Medicare Prescription Drug Program:

How about the war spending and the prescription drug costs that Geithner also cites as the root cause of the debt? Again, he’s wrong. And here’s why.

Those policies were implemented in the early 2000s, and through 2008, annual deficits ranged from $160 billion to $458 billion annually. But in 2009, after President Obama took office, that number shot up to $1.4 trillion. How could existing policies with stable costs suddenly triple the annual deficit? They couldn’t — the cause was collapsing revenues from the recession along with Obama’s stimulus spending.

The Future:

While Geithner and the president are turning their heads to stare down the past, they’re refusing to do anything about the future. And they’re making matters worse. Under the president’s budget, mandatory spending increases by $1.16 trillion through 2022 while producing cumulative deficits of $6.4 trillion. Meanwhile, the president does nothing to reform the tax code or to tackle the entitlement spending crisis, leaving the future even worse than the present.


Article printed from The Foundry: Conservative Policy News from The Heritage Foundation: http://blog.heritage.org

URL to article: http://blog.heritage.org/2012/04/17/why-bush-isnt-responsible-for-todays-debt-crisis/

URLs in this post:

[1] Image: http://blog.heritage.org/wp-content/uploads/2009/02/obama_bush090211.jpg

[2] claimed: http://www.msnbc.msn.com/id/3032608/vp/47054136#47054075

[3] According to Heritage research: http://www.heritage.org/research/commentary/2010/07/the-bush-tax-cuts-and-the-deficit-myth

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