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Bush-era policies account for more than $7 trillion of the deficit

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Running in the red: How the U.S., on the road to surplus, detoured to massive debt By Lori Montgomery in the Washington Post:

The nation’s unnerving descent into debt began a decade ago with a choice, not a crisis.

In January 2001, with the budget balanced and clear sailing ahead, the Congressional Budget Office forecast ever-larger annual surpluses indefinitely. The outlook was so rosy, the CBO said, that Washington would have enough money by the end of the decade to pay off everything it owed…

Now, instead of tending a nest egg of more than $2 trillion, the federal government expects to owe more than $10 trillion to outside investors by the end of this year. The national debt is larger, as a percentage of the economy, than at any time in U.S. history except for the period shortly after World War II.

Polls show that a large majority of Americans blame wasteful or unnecessary federal programs for the nation’s budget problems. But routine increases in defense and domestic spending account for only about 15 percent of the financial deterioration, according to a new analysis of CBO data.

The biggest culprit, by far, has been an erosion of tax revenue triggered largely by two recessions and multiple rounds of tax cuts. Together, the economy and the tax bills enacted under former president George W. Bush, and to a lesser extent by President Obama, wiped out $6.3 trillion in anticipated revenue. That’s nearly half of the $12.7 trillion swing from projected surpluses to real debt. Federal tax collections now stand at their lowest level as a percentage of the economy in 60 years.

Big-ticket spending initiated by the Bush administration accounts for 12 percent of the shift. The Iraq and Afghanistan wars have added $1.3 trillion in new borrowing. A new prescription drug benefit for Medicare recipients contributed another $272 billion. The Troubled Assets Relief Program bank bailout, which infuriated voters and led to the defeat of several legislators in 2010, added just $16 billion — and TARP may eventually cost nothing as financial institutions repay the Treasury.

Obama’s 2009 economic stimulus, a favorite target of Republicans who blame Democrats for the mounting debt, has added $719 billion — 6 percent of the total shift, according to the new analysis of CBO data by the nonprofit Pew Fiscal Analysis Initiative. All told, Obama-era choices account for about $1.7 trillion in new debt, according to a separate Washington Post analysis of CBO data over the past decade. Bush-era policies, meanwhile, account for more than $7 trillion and are a major contributor to the trillion-dollar annual budget deficits that are dominating the political debate.

President Obama should stop beating around the Bush – the deficit is, was and always has been caused by and for Republicans. Not one of them admits that the road out of the deficit begins with higher taxes.

Categories: General

9 Responses

  1. Liam says:

    If you want the facts on this and several other imporant issues, check out http://www.zfacts.com.

  2. funny numbers says:

    Both the house and senate have been controlled by democrats since 2007. So the 2008 – 2011 budgets were under dems watches.

    2000 236.4 Billion Dollar Surplus 290.772 Billion Surplus
    2001 127.3 Billion Dollar Surplus 152.76 Billion Surplus
    2002 157.8 Billion Dollar Deficit 186.204 Billion Deficit
    2003 374 Billion Dollar Deficit 430.1 Billion Deficit
    2004 413 Billion Dollar Deficit 462.56 Billion Deficit
    2005 319 Billion Dollar Deficit 347.71 Billion Deficit
    2006 248 Billion Dollar Deficit 260.4 Billion Deficit
    2007 162 Billion Dollar Deficit 165.24 Billion Deficit
    2008 455 Billion Dollar Deficit 455 Billion Deficit
    2009 1416 Billion Dollar Deficit 1416 Billion Deficit
    2010 1294 Billion Dollar Deficit 1294 Billion Deficit
    2011 1650 Billion Dollar Deficit 1650 Billion Deficit

    So Bush was responsible for the Stimulus????? our that doesn’t count either?

    that was part of the 2009 deficit numbers.

  3. Bonnie Davenport says:

    The comment from “funnynumbers” that attributes the 2009 deficit to Obama is completely invalid. The 2009 budget was adopted in 2008 under Bush. The Federal fiscal year 2009 started on October 1, 2008 – more than 3 months BEFORE Obama even took office. You are spouting nonsense “funnynumbers”, no wonder you refuse to provide your name!

  4. founding number says:

    again….show factual numbers. You are like a msnbc talking head.

    “A lot of the price rise is due to the dollar’s fall in value – and yes, that’s Bush’s fault.!”

    As i showed you earlier, obama has increased the deficit more in 2 years than bush did in 8 yet it’s bush’s fault?????
    For the first time ever, our AAA sovereign rating is threatened. Is that bush’s fault as well.

    The funny thing about uber liberals like yourself, is that there is no personal responsibility and never any admittance when you are wrong.

    The latest hot topic issue is the dream act. Obama has been running around blaming Republicans for not letting it pass? pure politics. Let’s be honest, democrats are looking to pass this, not because they believe it’s sustainable, but just because they want perpetual votes.
    How can he blame republicans? There was a dem house, senate and president for 2 years. why didn’t they pass it then?

  5. Jonathan Kantrowitz says:

    A lot of the price rise is due to the dollar’s fall in value – and yes, that’s Bush’s fault.!

  6. Jonathan Kantrowitz says:

    Not deleted – awaiting moderation – I was in the hospital – sorry for the delay.

  7. Vigilante says:

    And the price of gasoline at the pump…this too was Bush’s fault, according to Kantrowitz. Right?

  8. odd says:

    my comment from ealier got deleted. that is strange

  9. funnynumbers says:

    “Now, instead of tending a nest egg of more than $2 trillion, the federal government expects to owe more than $10 trillion to outside investors by the end of this year”

    I’m curious where you math comes from. You are assuming that the variables given to the CBO are correct and not manipulated to come at a favorable or desired end result. The same CBO that said Obamacare is deficit neutral before that was jammed through???

    Let’s first discuss the surplus that we were running in the late 90s. There was a little situation in the 90′s called the internet bubble. Fake income, wake wealth and fake jobs were created. Obviously if everyone is getting on the stock mkt (usually a first sign there is a bubble) there has to be the opposite effect when the actual bubble bursts. You and the CBO are correct….if the stock market goes up 10-20% every year for infinity we would always run a surplus. In this case you just tax capital gains @ 50% and everyone is happy. (Bernie Maddoff would have never gotten caught)

    Next I want to look at your numbers. From 2000 – 2008 (bush) the country totalled 2.305 trillion in debt excluding interest.

    Obama, a democratic house and senate ran up 3.220 trillion dollars in two years!!!!!! That is 2009, and 2010.

    How did the stimulus work out for you????