President Barack Obama likes to claim that he inherited a huge deficit, and he did. It’s just that he didn’t inherit one nearly as huge as he made it. From Gretchen’s hometown newspaper:
White House: Budget deficit to top $1.8 trillion
By ANDREW TAYLOR Associated Press
Published: 5/11/2009 8:37 AM
Last Modified: 5/11/2009 10:57 AM
WASHINGTON — Mirroring the unprecedented red ink flowing from America’s deep recession, the deficit for the current budget year will rise by $89 billion to $1.84 trillion — about four times the record set just last year.
The budget also reflects the costs incurred for the Wall Street bailout, President Barack Obama’s economic stimulus bill, as well as a structural imbalance between what the government spends and what it takes in.
For the current fiscal year that ends on Sept. 30, the government would borrow 46 cents for every dollar it takes to run the government under the administration’s plan. In one of the few positive signs, the actual 2009 deficit is likely to be $250 billion less than predicted because Congress is unlikely to provide another $250 billion in financial bailout money.
The Associated Press is more anal than most news sources about quoting, even under “fair use” rules, so I’ll have to leave it at that; you can read the rest at the link. But, put briefly, here’s the scoop.
- The record FY2008 budget deficit was $455 billion.
- FY2009 began on 1 September 2008, when George Bush was still president, and projections before the banking system problems were for a similar deficit for 2009.
- The TARP banking system bailout bill was passed in October of 2008, and signed into law by President Bush. However, half of the $700 billion in the TARP bailout was held in abeyance, until its release was authorized by President Obama.
- The $787 billion “stimulus package” was passed by Congress during this Administration, and signed into law by President Obama.
If the FY2009 deficit comes in at the now predicted $1.84 trillion, President Obama cannot claim that it is somehow all President Bush’s deficit. We can certainly credit the continuing, “structural” deficit that was $455 billion in FY2008 to President Bush. And we can credit half of the $700 billion TARP bailout bill to him. That puts is the (approximate) range of $800 – $850 billion.
But President Obama gets the credit for the other half of the TARP bailout bill; it could not be released until he signed the authorization. The $787 billion “Porkulus” plan is all his. He wanted it, he signed it, and he was proud of it, but, that being the case, he should have the cojones to admit that’s his part of the FY2009 budget deficit.
But, it gets even better. President Obama wanted another $250 billion in financial bailout money, but the Congress appears likely to turn it down. That may reduce the projected deficit by $250 billion, but if it does, then it shouldn’t be President Obama who gets the “credit” for $250 billion of deficit reduction; that will have occurred in spite of him.
OK, just one more direct quote:
Annual deficits (forecast by the Obama Administration) would never dip below $500 billion and would total $7.1 trillion over 2010-2019. Even those dismal figures rely on economic projections that are significantly more optimistic — just a 1.2 percent decline in gross domestic product this year and a 3.2 percent growth rate for 2010 — than those forecast by private sector economists and the Congressional Budget Office.
At what point will the buck stop on Mr Obama’s desk? At what point will the man who asked us to vote for him to be our President, to be our nation’s leader, actually accept the responsibility for what happens under his government’s actions? When will he point the finger at himself, and say, “This is my responsibility,” and not try to blame it on somebody else?