Archive for Tuesday, February 2, 2010

Obama budget: Record spending, record deficit

February 2, 2010

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— Spelling out painful priorities, President Barack Obama urged Congress on Monday to quickly approve a huge new shot of spending for recession relief and job creation, part of a record $3.8 trillion budget that would boost the deficit beyond any in the nation’s history while only slowly beginning to put Americans back to work.

If Congress goes along with Obama’s election-year plan, the nation would still end the year with unemployment pushing double digits at 9.8 percent and this year’s pool of government red ink deepening to $1.56 trillion under the administration’s accounting.

The spending blueprint for next year calls for tax cuts for workers and business and more aid for cash-starved state governments as well as the unemployed. The jobs initiative largely mirrors last year’s stimulus bill, but is about one-third its size. The president is asking for nearly $300 billion for recession relief and job stimulus.

Comments

jmadison 5 years, 3 months ago

Regarding Obama's reprise of a stimulus jobs bill, Albert Einstein had a relevant thought: Insanity: doing the same thing over and over again and expecting different results.

cowboy 5 years, 3 months ago

The single largest contributor to the deficit over the next decade is the Bush tax cuts which were unfunded The second highest contributor is the loss of revenue due to the financial downturn Third is the cost of the two wars Fourth is the stimulus spending

Where were all of these religious deficit fighters when the repubs cut taxes Where were they when Cheney put us into Iraq What were they doing while the banking industry was robbing the country They were pretty much doing the same thing as now , not much.

Perhaps the local teapartiers could use some research to educate themselves rather than just spewing fox news speech

cowboy 5 years, 3 months ago

It's quite simple Barry , If you cut revenue , and don't cut a corresponding amount of expenditure , you create a negative variance. What part of this equation is confusing to you ?

BarryPoserthought lives unprecented , Darwin Bless You all.

Olympics 5 years, 3 months ago

The single largest contributor to the deficit over the next decade is the Bush tax cuts which were unfunded The second highest contributor is the loss of revenue due to the financial downturn Third is the cost of the two wars Fourth is the stimulus spending

Cowboy FTW.

cowboy 5 years, 3 months ago

No one argues the spending number , whats the cause ? Do a little research

supertrampofkansas 5 years, 3 months ago

What the heck is a "graff"?

Appropriate name Feeble. Quick, without looking at the "graff"s, can you tell me how much federal spending increased under republican presidents as opposed to democrat presidents. Same question for the national debt. You do understand the difference between the national debt and federal spending don't you Feeble?

As the cowboy says, you might want to do a little more research.

LoveThsLife 5 years, 3 months ago

So let me get this straight, the argument that I am hearing is because Bush spent a lot of money Obama can spend a lot too?

Wow, what is happening to America?

What about looking at the problem in front of us and saying "it is what it is" and fixing it.

That is what disappointed me about Obama's State of The Union..he can't get past blaming his predecessor. In addition he can't come to terms with this truth....

It's not any one person's fault..it is a history of really bad policies, decision making, half truths and full out lies by both parties.

Obama's budget isn't going to help anything...our government is like an out of control teenager with his/her parents' credit card. The more they spend, the bigger they get the more dysfunctional things become.

cowboy 5 years, 3 months ago

Know whats funny , Reagan wouldn't pass the GOP purity test , He grew government , raised taxes , and favored immigration amnesty. Maybe the GOP should consider the new program NMLB.

No Moron Left Behind

Chris Golledge 5 years, 3 months ago

...and, lest we forget, record size pile of stuff inherited from previous administration.

I wonder, in relative dollars, how much did Roosevelt spend to get us out of the Great Depression. And, what would have happened if his predecessor had done it first.

Chris Golledge 5 years, 3 months ago

I guess you could argue that Bush and Obama both spent a lot, but then you'd have to look at where the money was spent. A couple of wars (only one of which was in any way justified), and tax breaks for the wealthy, versus...

Flap Doodle 5 years, 3 months ago

supertramp, you do understand that a President can propose a budget, but the Congress has the option to pass it, alter it or turn it down, don't you?

Chris Golledge 5 years, 3 months ago

Comrade, I can't tell you what to believe, but I can point out that your beliefs are not a fair representation of reality.

"Two UCLA economists say they have figured out why the Great Depression dragged on for almost 15 years, and they blame a suspect previously thought to be beyond reproach: President Franklin D. Roosevelt."

http://newsroom.ucla.edu/portal/ucla/FDR-s-Policies-Prolonged-Depression-5409.aspx

"Although it is not the mainstream view, a number of economists believe that the New Deal delayed economic recovery.[8] A 1995 survey of economic historians asked whether "Taken as a whole, government policies of the New Deal served to lengthen and deepen the Great Depression." Of those in economics departments 27% agreed, 22% agreed with provisos, and 51% disagreed. Of those in history departments, only 27% agreed and 73% disagreed.[71]"

  1. a b Robert J. Samuelson, The Great Depression. The Concise Encyclopedia of Economics.
  2. "EH.R: FORUM: The Great Depression". Eh.net. http://eh.net/lists/archives/eh.res/feb-1997/0010.php. Retrieved 2008-10-11.

supertrampofkansas 5 years, 3 months ago

Snap,

Ah so you are directing a comment at me even though I merely replied to one. You might want to direct that at the original poster. Curious isn't it. When you look at the data from a president's perspective, then the republicans all want to start pointing fingers elsewhere. Whereas now, it is solely directed at Obama. Of course, I understand this to be more of a single blame game. Do you and do you apply it equally historically?

Flap Doodle 5 years, 3 months ago

All this and we still haven't gotten our unicorns.

jimmyjms 5 years, 3 months ago

"“The single largest contributor to the deficit over the next decade is the Bush tax cuts which were unfunded”…..Unfunded Taxes???"

Yes, Barry. You might have been asleep during civics, but you can't cut taxes and pay down an enormous deficit at the same time.

It bears repeating: where were all you deficit hawks from 2001-2009?

This is cute too:

"McCain's Top Campaign Adviser: Record Deficits Would Have Happened Under McCain, Too"

"In an interview on MSNBC, Douglas Holtz-Eakin argued that under McCain's stewardship economic policy would have been strikingly different than under Obama -- with a much smaller stimulus bill and government expenditures going down as opposed to up.

But the former Congressional Budget Office director did acknowledge that, even with these changes, the country "probably would still have a record deficit" as is projected under the Obama administration."

http://www.huffingtonpost.com/2010/02/01/mccains-top-campaign-advi_n_444458.html

This as well:

"A forthcoming study by the Center on Budget and Policy Priorities concludes that the $1.4 trillion annual deficit run by the government has little to do with current White House policies and much to do with George W. Bush's actions.

"What we have looked at were several major contributors to the deficit: the tax cuts between 2001 and 2003 (on the assumption they get extended in 2010), the cost of the wars in Iraq and Afghanistan and the effects of the recession as well as the legislative response to the recession," James Horney, director of federal fiscal policy at the Center, told the Huffington Post. "When you take those things into account -- in other words, if we hadn't enacted the tax cuts, had the wars, if we hadn't had the recession and needed the legislation to deal with those problems -- the deficits are much, much lower. And basically none of those represent Obama's policies. He didn't run saying he wanted to pass a stimulus to deal with the recession or that he wanted to continue the war in Iraq or escalate [to this extent] in Afghanistan. He inherited these issues once he took office."

http://www.huffingtonpost.com/2009/12/10/obama-grappling-with-fall_n_387121.html

I realize that when you see that these aren't from Newsmax you'll dismiss them. But here they are.

Richard Heckler 5 years, 3 months ago

This whole disaster began in 1980 when an unproven economic theory was presented aka Reaganomics aka Wreckanomics. This crew says it all beginning with the Reagan Bush home loan scandal.

Who has history with financial institutions going south such as the savings and loan home loan scandal? http://rationalrevolution0.tripod.com/war/bush_family_and_the_s.htm

Monday = NO economy

All of this began to unfold in 2004 when homes began to lose value and repos were increasing rapidly by 2007

Paulson and Bernanke go to Congress to present a rescue plan to congressional leadership. "If we don't do this, we may not have an economy on Monday," warns Bernanke. Sept 18 2008

http://www.pbs.org/wgbh/pages/frontline/meltdown/cron/

The Bush/Cheney Home Loan Scandal http://www.dollarsandsense.org/archives/2009/0709macewan.html

About the bail out money? Where did it go? http://www.democracynow.org/2009/9/10/good_billions_after_bad_one_year

Bottom line is that the government better take the bull by the horns and begin setting up nationalized industries. IF anyone wants the USA to be a serious part of the world economy again. Local,state and federal level politicians are feeding us a lot of apple pie.

Without a means for america to make money there can be no substantial economy as we have all known it. It is time to stop messing around. It is time to start creating jobs for people to make money. Corporate america will not do it.

Frontline tells it like it was.... http://www.pbs.org/wgbh/pages/frontline/meltdown/cron/

Richard Heckler 5 years, 3 months ago

Mark Knoller is a White House Correspondent for CBS News. (AP)

On the day President Bush took office the second time, the national debt stood at $5.727 trillion. The latest number from the Treasury Department shows the national debt now stands at more than $9.849 trillion. That’s a 71.9 percent increase on Mr. Bush’s watch.

The bailout plan now pending in Congress could add hundreds of billions of dollars to the national debt – though President Bush said this morning he expects that over time, “much if not all” of the bailout money “will be paid back.”

But the government is taking no chances. Buried deep in the hundred pages of bailout legislation is a provision that would raise the statutory ceiling on the national debt to $11.315 trillion. It’ll be the 7th time the debt limit has been raised during this administration. In fact it was just two months ago, on July 30, that President Bush signed the Housing and Economic Recovery Act, which contained a provision raising the debt ceiling to $10.615 trillion.

Deputy Press Secretary Tony Fratto declined an invitation to comment on the enormous jump in the national debt during Mr. Bush’s presidency. He referred me to OMB – the Office of Management and Budget, which tried to make the case that as a percentage of the economy, the national debt is not that big.

In its budget documents in February, OMB estimated that next year’s national debt would hit $10.4 trillion – which it said would amount to 69.3 percent of the gross domestic product – the standard measure of the size of the economy.

That’s high – but far from an all-time high. After World War II, the national debt soared to over $270 billion – a quaint figure by today’s standards. Numerically, it’s less than the amount of federal deficit we now run up in a single year. But back in 1946, the Debt amounted to 121.7 percent of the size of the total economy.

By the time Richard Nixon began his second term in 1973, the national debt had grown to $466 billion – though as percentage of GDP, it had fallen to 35.7 percent.

Today, OMB press secretary Corinne Hirsch, renewed the oft-made government argument that reporters should focus on just that part of the national debt that is held by the public – now about $5.6 trillion and not include that portion billed as “intra-governmental holdings” – money the government owes itself – especially the Social Security and Medicare trust funds.

He was shown a white file cabinet with keypad locks on each of its four drawers in which the Social Security Trust Fund is stored. On that day, there was no cash – as he noted in a speech later in the day.

President repeatedly lied to the public about social security: http://www.dollarsandsense.org/archives/2005/0505orr.html

Richard Heckler 5 years, 3 months ago

"President Clinton announces another record budget surplus! In June, the administration predicted the surplus would be $211 billion, and would increase by as much as $1 trillion over the next 10 years."

From CNN White House Correspondent Kelly Wallace

September 27, 2000 Web posted at: 4:51 p.m. EDT (2051 GMT)

"WASHINGTON (CNN) -- President Clinton announced Wednesday that the federal budget surplus for fiscal year 2000 amounted to at least $230 billion, making it the largest in U.S. history and topping last year's record surplus of $122.7 billion.

"Eight years ago, our future was at risk," Clinton said Wednesday morning. "Economic growth was low, unemployment was high, interest rates were high, the federal debt had quadrupled in the previous 12 years. When Vice President Gore and I took office, the budget deficit was $290 billion, and it was projected this year the budget deficit would be $455 billion." President Clinton announces that the federal budget surplus for fiscal year 2000 is the largest in U.S. history

Instead, the president explained, the $5.7 trillion national debt has been reduced by $360 billion in the last three years -- $223 billion this year alone.

This represents, Clinton said, "the largest one-year debt reduction in the history of the United States."

"Like our Olympic athletes in Sydney, the American people are breaking all kinds of records these days. This is the first year we've balanced the budget without using the Medicare trust fund since Medicare was created in 1965. I think we should follow Al Gore's advice and lock those trust funds away for the future," he said.

In June, the administration predicted the surplus would be $211 billion, and would increase by as much as $1 trillion over the next 10 years.

"The key to fiscal discipline is maintaining these results year after year. We need to put our priorities in order," Clinton said."

The president's news comes as lawmakers on Capitol Hill continue to wrestle with the fiscal year 2001 budget numbers. The new budget year begins October 1, and work has been completed on only two of the 13 annual spending bills, as the Republican-led Congress and the White House remain at odds over spending allocations.

"I am concerned, frankly, about the size and last-minute nature of this year's congressional spending spree, where they seem to be loading up the spending bills with special projects for special interests, but can't seem to find the time to raise the minimum wage, or pass a patients' bill of rights, or drug benefits for our seniors through Medicare, or tax cuts for long-term care, child care, or college education," Clinton said.

"These are the things that need to be done and I certainly hope they will be and still make the right investments and the right amount of tax cuts," Clinton said.

jimmyjms 5 years, 3 months ago

"Most of the increases are on the civilian side, which will grow by 153,000 workers, to 1.43 million people, in fiscal 2010. ”

Yes, god forbid that the administration create gasp jobs!

notajayhawk 5 years, 3 months ago

jimmyjms (Anonymous) says…

"You might have been asleep during civics, but you can't cut taxes and pay down an enormous deficit at the same time. "

Whereas the Obama plan is to raise taxes and still not pay down an enormous deficit - instead, making it grow!

Good plan!

"A forthcoming study by the Center on Budget and Policy Priorities concludes that the $1.4 trillion annual deficit run by the government has little to do with current White House policies and much to do with George W. Bush's actions."

Uh huh.

So, when the economy improves, it's all due to Dear Leader, but when things go sour, the CBPP says his policies don't really affect the deficit.

Gee, wish I had predicted this belief system from the kool-aid drinkers before the election.

Oh, wait - I did!


cg22165 (Anonymous) says…

"I can't tell you what to believe, but I can point out that your beliefs are not a fair representation of reality."

Ah, the consensus approach to truth, made popular by the AGW proponents.

beatrice 5 years, 3 months ago

Talk about your abreviated version of the story! Why am I not surprised, LJWorld.

"It is important to remember that most of that $3.8 trillion, nearly $2.4 trillion, is for mandatory spending — on programs like Medicare, Medicaid, Social Security and for interest on the national debt. Medicare and Medicaid alone will cost $788 billion; that should be another reminder of why the country needs health care reform." http://www.nytimes.com/2010/02/02/opinion/02tues1.html?hp

Of course, why let some facts get in the way when you want to act like it is all about spending money for liberal causes. How foolish. Lets point fingers instead.

LoveThsLife 5 years, 3 months ago

"I guess you could argue that Bush and Obama both spent a lot, but then you'd have to look at where the money was spent. A couple of wars (only one of which was in any way justified), and tax breaks for the wealthy, versus…"

Yeah, but I still have issues with that argument. Out of control spending is still out of control spending regardless of where the money goes to. In the end the consequences are the same if we spend beyond our means.

jimmyjms 5 years, 3 months ago

"Gee, wish I had predicted this belief system from the kool-aid drinkers before the election."

Who posited that? I didn't. But doesn't that make some amount of sense? Bush and the GOP need to take the credit for turning a $200 billion dollar surplus into a trillion dollar deficit, just like Obama will have to accept the credit for the outcome of his initiatives. But where you endeavor to call people names, you blithely ignore the facts: a republican administration got us into this mess - by cutting taxes for the wealthiest while launching two wars but forgetting to, y'know, pay for them. The current POTUS has to do something. ARRA saved this country from a second great depression.

Do you ever check in with reality? How do you explain away the fact that this guy inherited a huge deficit?

What would you suggest that he do?

LoveThsLife 5 years, 3 months ago

Well, first he can quit complaining about it.

Then he AND congress could start by slicing away unneeded expenditures. For example, the new offices that senators will be getting this year..that is an unnecessary expenditure.

They could also vote to cut their own benefits...such as lifetime health insurance...that would be a GREAT start.

In addition, they could also seriously analyze what is working and what is not. Then they could quit dumping money into programs that are unneeded and not working. For programs that are necessary but not working well..they could retool them to be more cost effective and efficient.

Another easy way to save money is to look into our governments various contracts with suppliers...how much are they being overcharged?

I can think of one case I know of in a Military Dental Lab where it was cheaper to buy product as a civilian than through their contractors....

Seriously, there are a lot of ways to solve government spending.

Ricky_Vaughn 5 years, 3 months ago

cowboy, you're on fire today! Keep up the good work!

notajayhawk 5 years, 3 months ago

jimmyjms (Anonymous) says…

"ARRA saved this country from a second great depression."

And what color is your kool-aid today, jimmy?

You give Obama credit for "sav[ing] this country from a second great depression", but the deficit isn't his fault. And you really don't understand how you're cherry-picking, that when things go well he gets all the credit, but when things don't turn out so good he gets none of the blame?

"Do you ever check in with reality? How do you explain away the fact that this guy inherited a huge deficit?"

Do YOU, jimmy? Because - in case you didn't read the headline - while he did inherit a huge deficit, it wasn't as big as the one we have now, is it?

"What would you suggest that he do? "

Hmmm.

Let's see.

Stop making things worse?

feeble 5 years, 3 months ago

Should have guessed the graff meme would have been missed by most posters on this forum.

What I guess I had hoped people take away from those to graphs I linked early on was not that deficits or deficits are bad, and therefore Obama's engaging in some kind of moral equivalence because Bush II ran up the deficit.

Rather it was that when faced with recessions , such as the double dip in the early 80's, the S&L crisis in the late 80's early 90's, and dot-com crash in 2000, American Presidents have always turned to deficit spending to keep the economy running. It should not be surprising that Obama is doing the same.

feeble 5 years, 3 months ago

Liberty, you and I disagree, fundamentally, on a lot of things, which is why I usually avoid responding directly to you, but I usually try to take your responses seriously.

I can't take a comparison of our current economy, or even the economy post World War 2, to the economy pre-Hoover. That's toxic-asset apples to gold-standard oranges.

notajayhawk 5 years, 3 months ago

feeble;

That's where you're wrong. The theories of economics haven't changed. What Liberty is saying is that before Hoover and Roosevelt, we let the economy heal itself, and it worked. We haven't tried that since. Had the government not intervened in the current economic downturn, it very likely would have corrected itself. Government intervention quite possibly prolonged the problem, as the interventions of Hoover and Roosevelt did. But we'll never know, especially when the government uses voodoo statistics like the number of jobs that would have been lost, and people believe it - despite the fact that there is absolutely no way of verifying it.

TopJayhawk 5 years, 3 months ago

CG. FDR spent a ton of money and it did not bring us out of the depression, only WWll did that. Go do research.
It did not work then, it did not work when the idiot Bush tried it, and it won't work now. Again Einsteins theory of idiocy lives.

TopJayhawk 5 years, 3 months ago

CG. FDR spent a ton of money and it did not bring us out of the depression, only WWll did that. Go do research.
It did not work then, it did not work when the idiot Bush tried it, and it won't work now. Again Einsteins theory of idiocy lives.

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