Interesting Economics!
Things aren't looking good, folks.
S&P Slashes Outlook on U.S. to 'Negative' Amid Soaring Debt
Sounding the alarm about the country’s deep fiscal problems, Standard & Poor’s on Monday downgraded its outlook on the U.S. credit rating to “negative," raising the likelihood the U.S. will lose its coveted 'AAA' rating as Washington struggles to fix its beleaguered balance sheet.
The move signals the seriousness of the debt crisis in the U.S., which at most times is considered the safest investment in the world. It is likely to increase pressure on lawmakers and the White House to bridge their wide gaps and could mark the first step to the U.S. losing the perfect credit rating that allows it to tap the capital markets at very low rates.
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Historically, America’s credit rating had been seen as untouchable and among the safest in the world. “It is backed by a strong track record of prudent and credible monetary policy, evidenced to us by its ability to support growth while containing inflationary pressures,” S&P said.
However, spending has increased dramatically in recent years and, critically, tax revenues have failed to keep up the pace.
S&P said the U.S.’s total government deficit fluctuated between 2% and 5% of gross domestic product, or GDP, from 2003 to 2008. Yet it has “ballooned” to more than 11% in 2009 and has yet to recover, S&P said.
“More than two years after the beginning of the recent crisis, U.S. policymakers have still not agreed on how to reverse recent fiscal deterioration or address longer-term fiscal pressures,” S&P credit analyst Nikola Swann said in a statement.
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Hmmm. Deficit between 2% and 5% of GDP from 2003 to 2008. Deficit ballons to more than 11% of GDP in 2009. Why do those years jump out at me? What could have happened in 2009?
Holy crap, Batman! Can you say outta control in Washington?
The dollar's on its way to taking a huge beating. Deflated by out of control Obama spending. Now who would have ever seen that coming?
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Comments :
Meh
Fiscal year 2009 was Bush's final budget. And the things that caused the deficit to balloon-- the bailout of Fannie Mae and Fredde Mac, the bailout of Wall Street, the collapse of the economic activity that decimated the tax base and put workers onto the unemployment line, all happened under Bush.
skymutt: accept no substitutes!
Partisan blindness.
This is true but it is clear that the fiscal 2009 budget was NOT the source of ballooning debt. The 2009 budget was for approximately $3.107 trillion with a projected deficit of approximately $407 billion
, as comapred to approximately $2.9 trillion with a projected definict of approximately $239 billion 
in fiscal 2008.
Compare those to Obama's 2010 budget for approximately $3.552 trillion with a projected deficit of approximately $1.171 trillion
. So even in the straight budget terms Obama makes Bush look like a fiscal conservative (which he clearly was not).
Sorry, but reality disagrees.
This graph says it all. As we saw above the 2009 budget deficit was only about $407 Billion. As the chart above shows the total deficit in 2009 was more like $1.4 Trillion. Last I checked Obama took office on January 20, 2009 so I can't see how you can try and put that extra $1 Trillion in deficit for 2009 on Bush.
I know that you want to run away from the reality demonstrated above but facts are stubborn things and as we see above Obama's year over year deficits completely dwarf anything Bush ever did even if you blame ALL of 2009 on Bush.
Obama is spending this country into oblivion and groups like Standard and Poor are coming to recognize this (but this is a topic for another diary).
Well, your creative memory doesn't agree with the facts. Sorry.
Labor Force Statistics from the Current Population Survey
So even if I count January 2009 with an unemployment rate of 7.8% it is clear that unemployment ballooned under Obama to levels well beyond anything seen under Bush. In fact the current rate continues to significantly exceed anything seen under Bush.
So no matter how much you would like it to be different your claim that the decimation of the tax base occurred "all under Bush" is clearly and demonstrably false.
I'm the Bugs Bunny of Swords Crossed!
-4 Strongly Disagree - 0 Meh - Strongly Agree +4Meh
You know what a projection is? A guess. If I have $100 in my pocket, and I go out on the town for the evening and project that I was going to spend $20 but I end up spending the whole $100, how much do I have left in my pocket when I wake up the next morning? According to your "logic," what matters i that I projected that I would have $80 left. What really matters is the reality that I have $0 left.
Bush's projection is meaningless. What matters is not the $400 billion projection, which was just an estimate (and a poor one at that), but the last gray bar on your chart for FY 2009, which looks like about $1.4 trillion, which was what we actually spent.
Why did the projection undershoot the actual deficit by about a trillion dollars? Well, during the final months of the Bush presidency--which were during FY 2009 which started in September 2008-- we had a lot of unplanned expenses that were not accounted for in the FY 2009 budget-- $700 billion for TARP alone! Bailouts for AIG, Fannie, and Freddie. Federal subisidies for the takeover of Bear Stearns. Higher than expected payouts to unemployment assistance and food stamps and so forth. Need I go on? Hundreds of billions of dollars above and beyond the FY 2009 projections was gone and spent by the time Obama took office. Bush owns that FY 2009 gray bar. That is the deficit situation that Obama inherited-- a $1.4 trillion dollar deficit. He did not create those deficits as president.
The fact that Obama's first red bar is slightly larger than Bush's last gray bar reflects the fact that Bush also left Obama with an economy that was in the tank, as demonstrated by the trajectory of the unemploymemt figures in the data you have conveniently provided. Obama inherited an economy where the unemployment rate had shot up from 6.8% to 7.8% in just 2 months! At that rate, if job losses had remained constant for Obama's first year, unemployment would have shot up to 13.8% by January 2010! Instead, thanks to quick action by Obama in the form of stimulus-- there's your extra spending-- the unemployment rate had already levelled off by the end of his first year and had actually begun a slow decline.
By the way, you can see that Bush's deficit projections were wildly undershooting the reality even before FY 2009. By your own information, Bush projected a $239 billion deficit in FY 2008, but it looks like according to your chart that the actual deficit was about double that.
The graph also shows that deficits were exploding in size as early as FY 2008, further showing the alarming upward trajectory of the size of deficits in the late Bush years-- a trajectory that in fact Obama is arresting, and seeking to arrest further through serious deficit cutting efforts, something that Bush never attempted!
As far as the "projections" of Obama's budget through 2016-- well, he is hard at work trying to make sure that those rising red bars do not happen. And he is also trying to address the shortfalls in Social Security and Medicare, something that also did not happen under Bush. The only thing Bush did was tack on an ill-conceived and unpaid for drug benefit onto medicare, and propose converting Social Security to individual retirement accounts which would have COST several trillion dollars.
Your facts don't support your own claims. Facts are stubborn things indeed!
skymutt: accept no substitutes!
Continued partisan blindness.
Here I am presenting facts, figures, and charts. You're presenting obfuscating hand motions.
No, not meaningless at all. You're the one that brought up Bush's proposed FY 2009 Budget as an example of him ballooning the deficit. All I did was point you to the actual figures from that budget and highlight the fact the proposed level of spending was basically in line with his previous budgets. So your (implied) claim that the standard FY 2009 budget process was somehow related to the ballooning deficit that occurred in 2009 was a bogus concept.
I also pointed out later that Obama approved of the resulting budget by voting AYE. So either Obama was on board with passing a deficit ballooning budget, or he didn't think that final budget that passed was actually ballooning the deficit. Either way Obama is complicit in the FY 2009 budget process and can't get a pass on it as you want to give him.
OK, so the point is that there was a lot of FY 2009 spending that occured OUTSIDE of the normal FY 2009 budgeting process. That doesn't make the regular budget either out of line or inaccurate. The standard government programs which are accounted for in the normal budgetary processes were handled as they have always been and at levels consistent with prior budgets.
You are correct that a number of high dollar programs were created and had funds allocated at the end of 2008 before Obama took office. But most of that money was not spent until after Obama took office. While the funds had been allocated Obama was under no obligation to actually spend them. It was Obama's Administration and his Czars which were in charge of selecting if and where the allocated funds would actually be spent. He could easily have just not spent any of the money and proposed legislation to dismantle the programs created under Bush. He did not.
So to extend your analogy, if your mom put that $100 in your pocket "for emergencies" and then you decided to actually spend that money instead of finding other ways around your problems who is it that is actually responsible for spending the $100? You or your mom?
Bush owns allocating the funds. Obama owns actually spending them. Splitting hairs? Perhaps, but I don't think so. Nobody was forcing Obama to actually spend the money.
But this completely misses the point of the deficit graph above. It is a DEFICIT graph not a DEBT graph. In other words it represents the the size of the deficit incurred in each individual year. That year's deficit is then added to the public debt which becomes the cumulative value.
So even if I give you that the FY 2009 deficit as being 100% Bush then what does that mean? It means that Bush added $1.4 Trillion to the public debt in FY 2009. OK, there you go. Case closed. That $1.4 Trillion has been accounted for.
Even if Bush did this in FY 2009 that doesn't somehow force Obama to then propose $1.5 Trillion in deficit spending for FY 2010 which will then add an ADDITIONAL $1.5 Trillion to the public debt above and beyond what Bush did. Obama will own ALL of that $1.5 Trillion. Bush will be 100% out of the picture. That 2010 bar could just as easily have been $0 or even a surplus. Obama just needs to not propose spending money he doesn't have. It is Obama's choice and no one else's.
So what that deficit graph is showing is that Obama is making the choice to deficit spend at these levels into the foreseeable future. And as the NPR/Weekly Standard piece points out if you take the actual deficits incurred by Bush while he was in office and compare those that the deficits that Obama intends to incur by his own projections based on his own spending proposals you find that Obama will be out spending Bush by about $1 Trillion PER YEAR, year after year on average. These are stubborn facts that you can't just hand wave away.
And given all of this you can with a straight face try to claim that Obama is not a "big spender"? Sorry, Skymutt, but you are blinded by your partisanship.
I'm the Bugs Bunny of Swords Crossed!
-4 Strongly Disagree - 0 Meh - Strongly Agree +4Here's an interesting illustration for ya.
I'm the Bugs Bunny of Swords Crossed!
-4 Strongly Disagree - 0 Meh - Strongly Agree +4Useless analogy
Since I have a strong understanding of these matters, I don't need some YouTube wizard to "explain" them in some "user friendly" but ultimately simplistic way. The deficits have context. This guy does not indicate that he has any knowledge of history or why certain presidents ran deficits and others didn't.
Obama is not a big spender; he inherited a huge deficit, wars, and an economic crisis and, now that the economy is starting to turn into recovery, he is working hard to address the huge deficit-- and also is putting emphasis on fixing the unfunded liabilities of the big senior citizen entitlement programs, a problem Bush just kicked down the road, even when Republicans had full control of Congress.
To get anything done with the budget, looks like you need a blue bar in the White house!
skymutt: accept no substitutes!
Not useLESS, useFUL.
I note that you don't attack the accuracy of the information. You instead just try to pooh pooh it. You just want to ignore it. Sticking your head in the sand doesn't make these facts go away Skymutt.
I'm the Bugs Bunny of Swords Crossed!
-4 Strongly Disagree - 0 Meh - Strongly Agree +4Let me show you how dumb that video is
Let's consider two hypothetical presidents, President A and President B, both two termers, President A and President B have back to back administrations. with President B succeeding President A. President A succeeds a president who had a balanced budget his final year in office.
Here are President A's eight years of deficits:
Year 1: $50 billion
Year 2: $100 billion
Year 3: $200 billion
Year 4: $350 billion
Year 5: $550 billion
Year 6: $800 billion
Year 7: $1.1 trillion
Year 8: $1.6 trillion
Total debt racked up by President A: $4.75 trillion.
Now, President B takes over. Here are his eight years of deficits:
Year 1: $2.0 trillion
Year 2: $2.2 trillion
Year 3: $2.0 trillion
Year 4: $1.5 trillion
Year 5: $1.0 trillion
Year 6: $600 billion
Year 7: $250 billion
Year 8: $0
Total debt racked up by President B: $9.55 trillion.
Now, let's think about what your Youtube guy would have to say about the respective performance of President A and President B:
Now let's consider about how a sane and thoughtful person might consider the fiscal records of these two presidents:
Obviously, if the only evidence we are considering is the size of accumulated debt-- which is exactly what your YouTube guy is doing-- then his analysis obviously fails, because here we clearly have a situation where his analysis would reach exactly the wrong conclusion.
The funny thing is, while my hypothetical example is obviously structured in a specific way for the purposes of illustration, I think it's fair to say that Bush's fiscal record does bear some similarity to President A, and, at least in his first few budgets, Obama's record bears some similarity to President B. That's why your YouTube guy's analysis fails not only in my hypothetical situation, but in real life when comparing Obama to Bush.
skymutt: accept no substitutes!
DEFICIT does NOT equate to DEBT
So the bottom line comes down to:
President A wins. Period. President B was more than 2X as bad (where bad = passing debt on to following generations). Presidents don't inherit deficits, they create them. What one President inherits from another is the level of debt. Deficits are per year. Debt is cumulative. This is not rocket science.
The only sense that you can claim that Obama "inherited" a deficit is in his first year because the previous Bush administration proposed the budget for that year.
If there is a deficit in a President's first year that has zero bearing on whether he has to have a deficit in his second, third, or fourth years. Running a deficit in one year does NOT imply or impose the need to run a deficit in the following year. You do understand this, yes?
Obama could have proposed a balanced budget or even a surplus budget in 2010. He simply chose NOT to do so.
This is a very important distinction. We are not passing DEFICITS on to our children (or even the next Administration), we are passing DEBT onto our children. The two simply are NOT synonymous as you appear to believe.
I'm the Bugs Bunny of Swords Crossed!
-4 Strongly Disagree - 0 Meh - Strongly Agree +4Maybe I'm giving you too much credit here...
...because you genuinely seem to believe your blatantly ridiculous post.
Rather than trying to imagine that I am confused about the distinction between a deficit and debt-- I'm not in the slightest-- you need to realize that you need to educate yourself on deficits.
Deficits are NOT at all independent year to year, for many reasons. When a president takes office, that president inherits both an economy and a government-- the set of policies and programs left to him by his predecessor. Neither of these thing is wiped clean or remade from scratch when a new president takes office, nor could the possibly be.
To the extent that the economy is bad and tax receipts are less than average, you can have what is known as a cyclical deficit, which, since the economy does not just reset at the end of the year, can indeed be inherited.
To the extent that ongoing government programs and policies are not fully paid for by tax receipts during "normal" times, you can have what is known as a structural deficit, which, since government programs and policies do not just reset at the end of the year, can also be inherited.
Obama inherited a large deficit that had both cyclical and structural components. This is simply a fact.
Even all Republicans except you apparently recognize that deficits are not independent from year to year. That's why this budget they just passed in the house does not propose to create a balanced budget for many years, but rather gradually reduces the deficit each year over a period of several years to achieve, eventually, a balanced budget. If each yearly budget were truly independent of the prior year's budget, why aren't Republicans heroically proposing that we have a balanced budget in 2012? Because even they recognize that it's simply not feasible to do so-- there's no possible way to balance the budget in 2012 without severely damaging the country.
This indeed is not rocket science, but yet it appears to be eluding you.
Until you get up to speed on these essential facts, it would be useless for me to go further and try to explain to you why President B is more fiscally responsible than President A because you simply would not be capable of understanding. So, consider this post to be Deficits 101. When you gain an understanding of cyclical and structural deficits, we will proceed to Deficits 102: Applied Deficit Theory, in which I will patiently explain why President B's fiscal record is immeasurably superior to President A's.
skymutt: accept no substitutes!
Artifical distinctions with no substantive import.
Nah, it's not eluding me in the slightest. And your attempt to obfuscate a simple topic that every household in America can understand is duly noted. However, no matter how much you try to turn this into rocket science I'll just keep bringing you back to the cold hard truth ... something that clearly seems to be eluding you as you try to wriggle out from under it.
Cyclical deficit? Structural deficit? Unnecessary distractions in this conversation. Things can be easily simplified using the following equation:
Whether a given Deficit is cyclical or structural is irrelevant and not at all germane to this discussion. So let us simply stay focused on DeficitTotal which represents the bottom line shortfall in any given year. There's really no need to discuss things in more detail than that. Doing so will only obfuscate what is otherwise a very straightforward topic.
Sure they are. It is simply a matter of not planning to spend more in a given year than you are projected to bring in for the same year. But to drive your point home rather than simply alluding to some vague and ill-defined assertion dreamed up by you why not actually point to some specific examples from the Bush to Obama transition. What things in the state of the government that Obama "inherited" prevented him from proposing a balanced budget in FY 2010, or FY 2011, or beyond? Please be specific.
You are, of course, referring to the simple (and some would say obvious) fact that when Obama (or any President for that matter) takes the reigns of control of the government that the economy is operating at some specific level of output, and that there are pre-existing government programs and tax rates in place.
Let's focus on the government program and tax rate portions of these since they are the only portions that the government has any direct control over. The Economy essentially does whatever it does. The President has no direct control over what the Economy does. If you wish to argue otherwise please also explain why Obama does not simply utilize his magical powers to increase our current economic output and thereby increase governmental revenues and as a result actually balance our budget.
Strictly speaking the state of these things is actually the accumlated results of all previous Presidential Administrations, not merely the preceeding one. So to say that Obama inherited any of these things from Bush alone is, of course, demonstrably inaccurate and/or blatantly incorrect. What Obama "inherited" (as you want to call it) was the accumulated state of 200 plus years of governmental decision making, not simply something that was solely and directly the result of George W. Bush or his Presidency. Attempting to claim otherwise exposes the partisan political underpinnings of your position.
Obama is not unique in this respect. This is a circumstance that each and every President (except George Washington) has had to deal with. Some President's accept this, dig in, and try to move the country forward in a positive direction. Others, like Obama, find themselves helplessly overwhelmed by their own incompetence and simply want to play a partisan blame game, and they are generally emboldened by a host of partisan apologists such as yourself.
An excellent question. I don't claim to know the answer. Perhaps they are cowards? Perhaps they simply don't care? Perhaps they care about their own political future more than they care about the financial stability and long-term viability of the country? Perhaps they hate our grand-children?
I really don't know for sure. But I suspect that the reasons are basically the same as the reasons that drive Obama as well.
None of this contradicts, however, the simple and undeniable FACT that they CAN propose a balanced budget in 2012. Like Obama they are simply chosing NOT to and most likely they are doing so for political reasons. But this conversation is about Obama and not the Republicans in Congress so please stop trying to misdirect the conversation away from Obama. If yoou want to discuss these other people start another thread to discuss them.
This is an interesting comment at this point. Are you arguing here that the extra-budgetary FY 2009 spending that Bush proposed and to a large extent Obama approved with his votes and ultimately presided over as President was actually GOOD for the country?
I would fundamentally disagree with that contention on philosophical grounds but if this is what you actually believe then why are you posturing to position George W. Bush as a villian in this case? If the state of governmental spending that Obama inherited is necessary and simply gutting it would "severely damage the country" then why should Bush not be praised for having given Obama a situation where all of the proper steps had already been taken? Does this not imply that Obama actually inherited a situation which was already on track and the best that it possibly could be given the state of the Economy at that point in time?
The extent to which we have seen Obama simply adopting and continuing the Bush policies since day one (even where he had pledged to reverse course such as with Gitmo) would certainly add weight to such an argument would it not?
Please clarify this for myself and out readers. Do you view the Bush spending (that which occured outside the normal budgetary processes like e.g. TARP) as being good for the country, or detrimental to it? Choose carefully because I won't allow you to simply change positions when it is Obama executing and expanding on those same programs.
Or was your comment directed at something else? If so, what specifically did you mean so that we might examine it more closely.
I am up to speed on the essential facts and I have presented them here clearly, concisely, and most importantly with facts, figures, and supporting graphs. You have yet to present anything beyond simple self-serving hand waving and attemptes at obfuscation.
The essential facts from your hypothetical example are that President B ran up more than 2X the amount of public debt than President A and in doing so he placed more than 2X the burden on our children and grand-children than did President A. You can't get much more "essential" than that. :)
I'm the Bugs Bunny of Swords Crossed!
-4 Strongly Disagree - 0 Meh - Strongly Agree +4Obfuscation? Hardly. You've stripped out essential concepts...
...and I have merely brought them back into the conversation.
Puinting out that you and your YouTube guy have over-simplified a topic to the point of eliminating crucial information is not obfuscation.
Or rather inconvenient concepts which make it crystal clear that a deficit can be inherited-- torpedoing GoRight's statements to the contrary and demonstrating the insufficiency of YouTube guy's oversimplified analogy.
This is true to a large extent. The government can alter the economy at the margins, but in the short term, the forces of the economy are more powerful than any policy the government can throw at it. A president inherits an economy-- that is obvious. So, since the economy is essentially going to do whatever it is going to do in the short term, a cyclical deficit-- a deficit due to a low part of the economic cycle-- can be inherited. When Obama took office, the economy was in outright recession, and therefore there was a corresponding large cyclical deficit-- which he clearly and undeniably inherited, by the implications of your own admissions here.
By your own admission "there are pre-existing government programs and tax rates in place" when a president takes office. In other words, policies are inherited. Bush's programs and tax rates never led to a balanced budget in any year, even at the peak of the business cycle during the so-called "Bush Recovery"-- a classic situation of structural deficit. Since Obama inherited the policies, he also inherited the structural deficit-- they are inseparable from each other.
And by your own admission, a total deficit equals the sum of the cyclical deficit and the structural deficit. Since both components of the deficit are clearly inherited, clearly the whole deficit is inherited.
That was really a rhetorical question, and I already provided the answer-- "there's no possible way to balance the budget in 2012 without severely damaging the country." There's no real reason to look further for an answer until you have logically dismissed my explanation.
Even the Ryan plan's cuts, which fall far short of balancing the budget in FY2012 or any other year in the near future, would cause a significant drag on the economy in the short term. For instance, Republican economist Mark Zandi says that the Ryan cuts would cost 1.7 million jobs by 2014
.
In other words, budget cuts cost damage to the economy. Not hard to imagine, then, that severe budget cuts would cause severe damage to the economy.
Since you can't come up with a plausible reason for why the Republicans did not propose a FY2012 balanced budget, please explain why my explanation is not the likely true explanation, or concede the point.
Absolutely-- and I have already said this on multiple occasions. The spending to counteract the financial crisis was necessary. This is why I have said that Bush's final year in office was his best (he had set 7 rather low bars before of course).
The obvious caveat here is, of course, that that crisis spending was made necessary in large part by Bush policies which had been BAD for the country: an utter failure to regulate finanial institutions, policies that encouraged the housing bubble, and so forth.
And then there is the fact that the extra-budgetary spending would have been a lot easier to absorb, if Bush had been managing the budget responsibly over his entire term. Instead, Bush splurged on two rounds of tax cuts, a war of choice in Iraq, and an an unfunded Medicare drug plan, leading to a large structural deficit for which Bush is responsible. So the optional spending came on top of a FY 2009 deficit that would have already been several hundred billion dollars.
That's just spin. If we stipulate that the burden on our grandchildren refers to a 50 year time horizon, President A left the country with not only his 4.75 trillion debt, but also left behind deficits at a $1.6 trillion run rate. Assuming subsequent Presidents neither improve or worsen that deficit going forward, deficits would remain at $1.6 trillion infinitely. $1.6 trillion x 50 years = $80 trillion, not counting interest. That doesn't even account for the fact that when President A left office, there was a trend of sharply rising deficits. So, we're reallying giving President A a break here. Sill, even making calculations in favor of President A, President A is responsible for putting a burden of $4.75T + $80T = $84.75 trillion in debt on our grandchildren.
President B inherits an $80 trillion implied deficit on his grandchildren, by virtue of the $1.6 trillion run rate for deficits that he inherits. He actually incurs $9.55 trillion in debt, but leaves deficits at a $0 per year run rate. $0 x 50 years = $0 implied debt, assuming future presidents neither improve nor worsen the deficit going forward. So the debt burden left on our grandchildren which is attributabe to President B is $9.55 trillon, but he eliminated an $80 trillion implied burden left behind by his predecessor by reducing the deficit run rate by $1.6 trillion per year. So he has actually lifted an implied burden of over $70 trillion from our grandchildren. And that does not even account the fact that deficits are still improving when President B leaves office.
skymutt: accept no substitutes!
OK, so let's now drive this home a bit ...
I am afraid that you have some typos in your post above. Allow me to correct them for our readers:
:)
I disagree that you have shown any such thing, but we seem to be arguing over the semantics of "inherited". Introducing the disctinction between cyclical and structural deficits has changed nothing w.r.t. whether deficits are "inherited". There is absolutely nothing in the definition of cyclical deficit or structural deficit which has anything whatsoever to do with "inheritance" so they are, as I said, adding complexity for no real value. This is a hallmark technique of those wishing to obfuscate a topic.
So, please clarify exactly what you mean by "inherited" in the context of deficits. If all you mean is that at the point in time that Obama takes the reigns of control that the government may, or may not, be operating in a state where net spending exceeds net revenues then fine, given that narrow definition of "inherited deficit" we are in agreement. As I said, that point is obvious.
However, you also appear to be using the term to try and imply that because the Economy and the Government were in such a state when he took office that Obama was somehow powerless to change those things. If so, that is patent non-sense.
Obviously he cannot directly affect the Economy (I think we are agreed on that point) but he is more than free to try and change the spending and the tac rates to his hearts content.
Obama was, and still remains, completely able to effect immediate and significant discretionary spending cuts and to immediately propose legislation to completely dismantle any and all government spending. Combined these constitute more than sufficient means for him to propose a balanced budget in 2010, 2011, and beyond.
Do you agree or disagree that he has such powers at his disposal? If you disagree please point to specific legal and constiutional reasons why he lacks the powers I highlight above. [1]
To my knowledge Obama has neither used his discretionary authority to reduce the FY 2009 spending under discussion nor has he proposed legislation to eliminate or dismantle any of those spending programs for which he has [may have?] no discretionary authority. Lacking any such efforts on his part I contend that any spending that occurs while he is in office is rightly assigned to him and cannot be retro-actively assigned to Bush (or anyone else) through some notion of an "inherited deficit" (whether that deficit be total, cyclical, structural, or any other meaningless subdivision you care to create).
Do you agree or disgree? If you disagree please explain why and be specific.
I don't know why you would make such an assumption and I reject it out of hand.
Every subsequent President is responsible for reviewing and assessing the on-going need for any and all governmental spending. They don't get a pass for being lazy and lax in their duties. So if President B makes the fundamental decision to continue the level of spending that was occuring when he took office that is HIS DECISION, not his predecessor's. Likewise if he makes the decision to not even bother to review the spending at all. In either case the ball is in his court and no one else's.
The fact that President A proposed programs which resulted in deficit spending in his last year in no way obligates President B to continue that spending into the future. President B is free to seek to have any such spending removed in his very next budget proposal. This is undeniable and this is the basis of my contention that deficits are not "inherited" in the sense that the incoming President is somehow powerless to affect them. The incoming President has the ability to propose cutting any and all forms of governmental spending at any time.
Obviously in the most extreme case proposing the cutting of literally ALL governmental spending is within the President's powers and doing so would obviously lead to a huge budget surplus assuming that the trax rates remained unchanged even at their current levels. While it is unlikely that any President would take things to this level this does highlight the fact that they can, if they choose to do so, propose budget cuts sufficient to more than balance any budget shortfall that they may have "inherited" in the narrow sense agreed to above.
All of this in undeniable, but just to be clear do you agree or disagree that it is within the President's power to propose spending cuts up to and including all governmental expenditures?
Do you agree or disagree that having the power to propose cuts at these levels is more than sufficient to be able to propose a balanced budget in any given yearly cycle? If you disagree please describe the legal and/or constitutional barriers to being able to do so.
This is simply incorrect. The only portion of that hypothetical 84.75T that can in any valid sense be attributed to President A is the original 4.75T which occurred while he was in charge.
If President B subsequently decides to continue that spending throughout his term in office then he is responsible for that decision and that portion of the 84.75T that occurred while he was in charge.
If President B actually attempts to eliminate that spending but is prevented from doing so by Congress then he gets a pass on that portion which Congress overrode and Congress assumes the full responsibility for that spending from that point forward.
You are attempting to make President A retro-actively responsible for the actions and/or inactions of his successors. That is simply bogus on it's face. President A has no power to control or to affect the actions of his successors and so bears no responsibility beyond his own term in office.
At this point I think that we have more than beat our respective horses into the ground. Feel free to have the last word on this topic (unless you actually bring something new and substantive to the discussion).
--------------------------------------------------------
[1] Whether he could make such a proposal actually stick and get it passed in Congress is a separate discussion and is not germane to the point of whether he actually retains power sufficient to propose a balanced budget in 2010 given the pre-existing state of 2009.
I'm the Bugs Bunny of Swords Crossed!
-4 Strongly Disagree - 0 Meh - Strongly Agree +4Okay, thanks for the opportunity to close.
My counterpart GoRight likes to use analogies-- such as the one contained in the YouTube video that started this thread. So let me close with some analogies that illustrate GoRight's position as expressed in this thread.
Consider a case where we have two coaches, Coach A and Coach B. Coach A and Coach B are both hired in the same year, but they take over teams in vastly different circumstances. Coach A takes over a powerhouse team that won the league champoinship in the prior year and went undefeated with a perfect 16-0 record. Coach B, on the other hand, took over a team that was one of the worst team in league history; in fact, his team did not win a single game in the prior year, finishing with 0 wins and 16 losses.
In the subsequent three years, their teams finish with the following records:
Now, according to the view expressed by GoRight in this thread, we should judge that Coach A has done a better job than coach B, because, on his watch, his team has finished with more wins than Coach B. GoRight would have us narrowly look at that one single piece of data-- the coaches' cumulative record-- to the exclusion of all other evidence we have at hand.
But of course, that narrow focus on one piece of evidence to the exclusion of all other evidence leads to an absurd conclusion. The fact is, Coach A inherited a great team, and turned it into a loser in three short years. In real life, the teams fans would rightly be calling for him to be fired! And meanwhile, Coach B took over a terrible team, and in three short years, he had built a fine team that recorded an outstanding 12 and 4 record. The fans of coach B's team are thrilled with Coach B's performance, and for good reason!
Now, let's consider a case of tho CEOs: CEO A and CEO B. CEO A and CEO B are hired at the same time by different firms. Both firms took in $10 billion in revenue in the year prior to A and B's hiring, but the firms' performance are vastly different-- the firm taken over by CEO A performed quit well and booked a $2 billion profit the year before he arrived, while the firm taken over by CEO B struggled badly in the prior year and booked a $2 billion dollar loss.
In the subsequent three years, the profits/losses of the two firms are as follows:
Again, according to the view expressed by GoRight in this thread, CEO A should be judged to be the superior CEO, based on the fact that the cumulative profit on his three-year watch is greater than that of CEO B.
But again, just looking at that one piece of evidence to the exclusion of all other evidence leads to an obviously absurd conclsuion. CEO has turned a highly profitable company into a company that is hemorrhaging money in just three short years! His shareholders want him fired immediately if not sooner! And meanwhile, CEO B has turned a failing company into a company that is turning a tidy profit-- his shareholders could not be more pleased!
In both these situations, and in any other situation, it is demonstrably absurd to judge a leader based on a cumulative figure that boils down their performance into one solitary number, when there is additional evidence that can be considered.
skymutt: accept no substitutes!
Unless, of course ...
the subject of discussion IS that single parameter. The national debt in this case which is where this diary began.
I'm the Bugs Bunny of Swords Crossed!
-4 Strongly Disagree - 0 Meh - Strongly Agree +4No...
You yourself introduced, for instance, the graphh that showed the deficits in individual years. Now, apparently, since I have successfully used that other evidence against you, you would have us now ignore that additional evidence that you introduced, so that you can boil things down to one number like your YouTube guy. I take that as a sign that you recognize that if the extra evidence is considered, the logic used by yourself and your YouTube guy falls apart like a $200 sofa.
skymutt: accept no substitutes!
Also no.
I don't wish to ignore that graph. I introduced the graph as supporting evidence of how Obama is planning (by his own estimates) to drive the public debt up to record levels at a record rate. I think that the graph does that quite effectively despite yoru attempted obfuscation.
I'm the Bugs Bunny of Swords Crossed!
-4 Strongly Disagree - 0 Meh - Strongly Agree +4I thought I was going to get the last word in this thread!
I thought I wrapped the thread up well with my analogies of the coaches and the CEOs. I thought I summarized your position completely fairly. Now, you keep wanting more bites at the apple. You are burying my last word in extra posts!
skymutt: accept no substitutes!
Fair enough.
Note that I didn't quibble with your analogies. I don't necessarily agree that they are proper analagies for the current situation but I didn't quibble with them.
You made a reasonably fair attempt and, again, I didn't quibble even with your summary other than to correct one point where I thought you crossed a line. Saying that I wish to "now ignore" information that I had originally introduced is not accurate and, therefore, does not constitute a fair summary on your part. Beyond that one clarification on my part you did get the last word.
I'm the Bugs Bunny of Swords Crossed!
-4 Strongly Disagree - 0 Meh - Strongly Agree +4Heh, and here is a nice piece ...
found in that bastion of conservative wisdom, NPR:
Read the whole article. It is exceedingly fair to Obama.
I'm the Bugs Bunny of Swords Crossed!
-4 Strongly Disagree - 0 Meh - Strongly Agree +4That's not an NPR piece...
...its a Weekly Standard piece. The Weekly Standard is an ultraconservative rag, edited by Bill Kristol and Fred Barnes, who are most certainly bastions of conservative opinion, though often falling short of wisdom.
Just because NPR decided to be fair and balanced and put it on their site does not change it from what it is-- a biased red bar op-ed, full of bogus, dumb, and meaningless figures that are calculated to support a pre-fomulated opinion.
skymutt: accept no substitutes!
Oh yea, and one more thing ...
There's a nice resource for the 2009 budget process
where you can see the final Senate Roll Call vote 
on the FY 2009 Budget.
I draw your attention to the fact that then Senator Barack Obama voted YES (AYE) to the adoption of the final form of that budget. So it hardly seems right to try and distance him from the spending therein. He played an active roll in implementing the whole thing. If he actually disagreed with that spending in that budget he would presumably have voted NO (NAY). :)
Here's a little quote for you to ponder:
Facts are stubborn things; and whatever may be our wishes, our inclinations, or the dictates of our passion, they cannot alter the state of facts and evidence.
John Adams,
'Argument in Defense of the Soldiers in the Boston Massacre Trials,' December 1770
US diplomat & politician (1735 - 1826)
I'm the Bugs Bunny of Swords Crossed!
-4 Strongly Disagree - 0 Meh - Strongly Agree +4Mmm hmm
Well, then a crisis happened, and Bush ended up spending about a trillion more than was in that budget, as I have already established, so you can kinda throw that budget vote out the window.
skymutt: accept no substitutes!
Correction.
Bush made provisions to have funds available. Bush is only acocuntable for funds that were actually spent before Obama took office. After that point Obama was the one that made the decisions about if and where those funds would ultimately be spent. Had he not wanted to spend the funds he could have simply NOT actually spent the money.
So at best Obama and Bush share responsibility for the FY 2009 spending. Bush spent whatever he spent before Obama took office. After that Obama could have stopped all remaining spending.
Wikipedia has a bit of a section for TARP that addresses this point:
So, strictly speaking for TARP you can only claim that Bush is responsible for spending that $247 billion out of the potential $700 billion allocated.
Here is a nice site to review the stimulous spending: Stimulous.org
From there we find for TARP specifically:
So by my calculations Bush spent about $247 billion and Obama spent about $397 ($644 - $247) billion. Again, Obama has outspent Bush even within a program started under Bush. :)
Oh, and of course, Obama also voted YES (YEA) in the final passage of the bill in the Senate that would ultimately implement TARP
. So Obama also played his part in creating the program in the first place and was obviously on-board with the spending that he would eventually oversee.
I'm the Bugs Bunny of Swords Crossed!
-4 Strongly Disagree - 0 Meh - Strongly Agree +4Bush made provisions to have
Bush is responsible, at least in large part, for the piss-poor condition he left the country in, deficit-wise and otherwise, a fact with you cannot seem to face up to. Obama steps into office facing what can only fairly be described as a mess, and you persist in suggesting that since Obama was unable to snap his fingers and make the mess disappear by January 21st 2009, he has failed.
You're maintaining a position that is plainly ridiculous on its face, so it's really unnecessary for me to address the myriad individual ways you are attempting to make this general argument.
skymutt: accept no substitutes!
Heh
Strawman.
In case you were caught unaware here, the date is currently 4/23/2011 which is more than 2 years after Obama took charge. My comments are not really even dependent on the 2009 deficit. Like I said, even if I completely give you 2009 as being on Bush it doesn't matter. Obama by his own projections is planning to outspend Bush by a staggering $1.003 Trillion per year, on average. At that rate the country won't be able to AFFORD to elect Obama to a second term. It's a matter of self-preservation and fiscal responsibility (and no, I have never claimed that Bush was fiscally responsible except, perhaps, in his spending on National Defense).
I'm the Bugs Bunny of Swords Crossed!
-4 Strongly Disagree - 0 Meh - Strongly Agree +4