I have an open challenge:
In 2009, the Federal deficit is going to be $1.45 Trillion.
In 2010, the Federal deficit is expected to rise to $1.5o Trillion.
Someone tell me why this is even remotely acceptable?
Also, George W Bush currently holds the unofficial title as "Least fiscally responsible President ever", based on 8 years of huge deficits, culminating in a record-breaking 2008 deficit of $1.0 Trillion.
So...how is Obama not way, way, way worse?
Friday, November 13, 2009
News
Subscribe to:
Post Comments (Atom)
7 comments:
I would agree (and I am a socialist from up north!)...while we have the social programs (health care, 1 year mat leave etc) that cost $$$, we frown upon deficits...it's all about living within our means and not wanting everything now...baby steps.
Kari
. . .hmmmm- GREAT question! I'm going to go out on a limb and say Obama is about half a trillion times worse!! (:
...because that would be racist.
I definitely agree...he is way, way worse!! I don't know what we are going to do in this country...move to another one?!
I'm not American nor am I an expert in American internal politics/ economics but I do know that economics work in the long run.
There is no such thing as measures with purely short term effects in political economy even if politicians would like us to believe the contrary. They generally do not care to consider the long run, because, hey, what are the odds of them still being there in 4 years, let alone 8... So they often take stupid measures with temporary slightly positive effects and huge negative long run effects. It is the famous let-the-next-administration-pay-for-it technique. Moreover, every transition is bound to bring a downward period before it starts to pay off.
So, a big chunk of the deficit the US is facing now is actually the result of actions and non-actions of the Bush administration. And American health care for example is not only in need of a reform but a total flip-over.
I admit I have not analyzed the current Obama plans so I cannot judge them for being good or bad. All I am trying to say is that one should not stare sternly at these figures without decent long term analysis. LR analysis done by decent, independent economists that is, not by eco-politicians. Actually, every government in the world should ditch the latter because they refuse to look any further than their nose.
On political level on the other hand, I still have to hear about a politician, whether well or ill-advised, who is willing to sacrifice his face value during his or her term for the ultimate future good of his or her country. Too many interests, too much lobbying, ... and political systems with no backbone. Could the Obama administration ever change that in about 4 years, even if they were all little angels downing from the sky? Hell no!
The deficit increase from 2008 is due to several factors:
1) Economic Stimulus:
- TARP - $154B in '09
- ARRA - $202B in '09, $353B in '10
2) Recession causing lower individual and corporate taxes collected (less earnings = less taxes) + tax cuts enacted almost a decade ago = 16.6% decline in revenues (individual income tax receipts alone dropped $230 Billion)
FWIW, the 2010 deficit is supposed to drop down to 1.17Trillion, and $533 Billion by 2013
http://apnews.myway.com/article/20091017/D9BCHP5O0.html
http://www.cbo.gov/ftpdocs/107xx/doc10708/11-9-09MBR.pdf
http://en.wikipedia.org/wiki/2010_United_States_federal_budget#Deficit
Chris...you kinda missed my question...even if I give him a pass on 2009, why is 2010 going to be worse?(The 1.17T number is from March...in August, Peter Orszag, Obama's budget chief, said $1.5T)
Is he rolling out another TARP that we don't know about yet?
No argument on the revenue impact in 2009...except again, revenues are projected to rise again in 2010, but the defecit is still going up. Hmm...wasn't the stimulus a one-time expenditure?
Post a Comment