$1 Trillion More in Debt Since Obama Took Office
(CBS/iStockPhoto)
On Inauguration Day, the Debt stood at $10.626 trillion. The latest posting from the Treasury Department shows that as of July 31st, the debt hit $11.669 trillion.
During the last administration, it took over 2 ? years for the National Debt to increase a trillion dollars. But by the time former president George W. Bush left office, he had run up the deficit by a record amount: $4.9-trillion over eight years.
A great deal of current deficit spending was already in the pipeline from the Bush administration and Mr. Obama, anticipating this day, said that increases have to be kept in perspective.
"They basically handed me a bill for $1.3 trillion and said, 'Here, fix it,'" insisted the president last week at a Town Hall Meeting in Bristol, VA. "And now they're on TV saying, why haven't you fixed it yet -- in the middle of the greatest recession since the Great Depression."
But since Mr. Obama took office, Congress approved his $787-billion stimulus plan. In addition, the new Administration had reign over the second half of the $700-billion bank bailout program.
"Look, I understand the concern about debt," Mr. Obama said Thursday in Raleigh, N.C. "I'm looking at these spreadsheets every day. We dug ourselves a deep hole." And he concedes that the recovery package enacted on his watch has added to the problem.
"We're going to have to tighten our belt," he said. But he was quick to add that it cannot be done "just as the economy is coming out of recession. No economist would recommend that."
He says he understands those who believe the government is way too deep in red ink for him to pursue a trillion dollar program to overhaul the system of health care coverage in America, but he remains adamant about it. And he says that in the long run – over ten years - his plan will be deficit neutral and end up saving taxpayers money.
"We're not going to make progress on the deficit without dealing with health care," said spokesman Robert Gibbs today.
He said the administration doesn't think it can get the deficit under better control until it gets the economy moving again – and Mr. Obama believes health care reform is an indispensable part of that strategy.
The budget numbers issued by the Administration in May project the deficit in the current fiscal year will top $1.8-trillion dollars. But an updated report is due this month, and an even larger deficit is expected to be announced for the current fiscal year, which began October 1st – 3 ? months before Mr. Obama was sworn in.
(CBS)
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Just yesterday Obama indicated he plans to rack up $9 Trillion during his administration rather than the already obscene $7 Trillion he initially indicated!
Obama is like Reese Whitherspoon on Rodeo Drive with a limitless Charge Card! Buying votes until at last the country is broke.
1) People justifying Obama's reckless spending by saying that Bush was worse. Bush/Greenspan was disastrous for the economy. Obama has been terrible as well. A president needs to be judged on his own merit, not compared to a prior.
2) People who say things like, "What is Obama supposed to do -- nothing?" Actually, doing nothing is a viable economic alternative, just difficult politically since people demand action. With better economic education, people can be made to understand that the government cure is usually far worse that the disease in the long run. Keynes is blindly hailed as a hero by many but there are numerous economists (including Nobel Prize winners) who argue convincingly to the contrary, F.A. Hayek among them.
3) People blaming "greedy Wall Street people". I read a great analogy comparing the blaming of bankers to blaming gravity when a plane crashes. People, whether bankers, or not, respond to incentives. The incentives put in place by the government (low interest rates, encouraging lending to unqualified people) led to the natural, if not unfortunate, decisions by Wall Street bankers pursuing profits.
4) When people think we have "turned the corner" and things are now getting better (or that things would have been worse had the government not intervened). By increasing our debt, we have merely postponed the day of reckoning. The future tax revenue needed to finance this debt is too staggering to imagine. More likely, we'll monetize it, which will lead to inflation the likes of which this country has never seen.
Summary: Contrary to what the government would like you to believe, and what most in the media unquestioningly pass along, there are no simple solutions to a two decade consumption binge fueled by borrowing. The recession is the cure that allows for restructuring and future growth. We need to pay down our debt, start saving, and use that savings to invest in productive assets. A time of pain would be followed by growth and long run economic health. Instead, we dig our hole deeper and deeper by the day...
4)
1) People justifying Obama's reckless spending by saying that Bush was worse. Bush/Greenspan was disastrous for the economy. Obama has been terrible as well. A president needs to be judged on his own merit, not compared to a prior.
2) People who say things like, "What is Obama supposed to do -- nothing?" Actually, doing nothing is a viable economic alternative, just difficult politically since people demand action. With better economic education, people can be made to understand that the government cure is usually far worse that the disease in the long run. Keynes is blindly hailed as a hero by many but there are numerous economists (including Nobel Prize winners) who argue convincingly to the contrary, F.A. Hayek among them.
3) People blaming "greedy Wall Street people". I read a great analogy comparing the blaming of bankers to blaming gravity when a plane crashes. People, whether bankers, or not, respond to incentives. The incentives put in place by the government (low interest rates, encouraging lending to unqualified people) led to the natural, if not unfortunate, decisions by Wall Street bankers pursuing profits.
4) When people think we have "turned the corner" and things are now getting better (or that things would have been worse had the government not intervened). By increasing our debt, we have merely postponed the day of reckoning. The future tax revenue needed to finance this debt is too staggering to imagine. More likely, we'll monetize it, which will lead to inflation the likes of which this country has never seen.
Summary: Contrary to what the government would like you to believe, and what most in the media unquestioningly pass along, there are no simple solutions to a two decade consumption binge fueled by borrowing. The recession is the cure that allows for restructuring and future growth. We need to pay down our debt, start saving, and use that savings to invest in productive assets. A time of pain would be followed by growth and long run economic health. Instead, we dig our hole deeper and deeper by the day...
4)
From that point until the end of 2007 the country experienced its longest run of uninterrupted job growth of over 50 months with over 8 million jobs created. Real GDP averaged over 3% and unemployment averaged 5%. Tax receipts exceeded CBO projections by almost 450 billion from 2003 through 2007. For the tax year 2006 (latest year data available) the top 1% had 22% share of income and paid 40% of total taxes (highest percent in 40 years) up from 21% and 37.4% respectively in 2000. In 1990 1% share of income was 14% so the rich got richer while Clinton was president.
Government spending increased by 27% from 1993 to 2000. From 2001 to 2008 it increased by almost 60% Spending was 18.5% of GDP in 2001 and 20.2% in 2007. From 1993 through 1999 annual spending increase was less than 4%. From 2002 through 2006 the annual rate was greater than 7% in four of the years and greater than 6% in the other year.
It was the uncontrolled growth in government spending not the Bush tax cuts that caused the deficit to swell. And now Obama is planning on raising taxes while increasing government spending even more. A recipe for disaster.
No economist would recommend that? I'm sorry Mr. President, I think EVERY economist would recommend that!
This is a great example of an unfair headline. You have to read 4 paragraphs in to get this point.
"A great deal of current deficit spending was already in the pipeline from the Bush administration and Mr. Obama, anticipating this day, said that increases have to be kept in perspective."
At this point and until the next budget is passed, the bill is on George Bush. There is some spending that has occurred that is a result of decisions made by President Obama (stimulus bill for instance), but most of that has yet to be spent.
What you are talking about as being in the pilpeline from Bush is the budget that was actually not presented to Bush by the dem congress because they did not think he would sign it so they let it sit until Obama got in office and he gleefully signed it as he does anything that includes spending money. You people need to get off the Bush thing. Obama is in charge now and making some very stupid decisions.
1) There was a lot more "in the pipeline" than the budget legislation you refer to. Examples include War spending, TARP money, Medicare Rx spending-that-wasn't-paid-for etc..... obviously there is more.
2) Obama did not "gleefully sign" the budget that was left to him. That is so patently false, it serves to disprove your entire statement.
He clearly stated that he was signing the budget presented (including the "pork" projects proposed by both Republican and Democrat reps) to him as a matter of necessity in order to keep the government funded and it was with reluctance that he signed it.
It is also important to note that the country does not STOP and RESET between every succeeding administration and that the actions, policies, decisions of ALL previous administrations have the bearing of this continuity on the current administration.... Republican or Democrat.
Just because YOU don't like the guy who won the election and sits as president today doesn't change the way the country runs.
"A great deal of current deficit spending was already in the pipeline from the Bush administration and Mr. Obama, anticipating this day, said that increases have to be kept in perspective."
At this point and until the next budget is passed, the bill is on George Bush. There is some spending that has occurred that is a result of decisions made by President Obama (stimulus bill for instance), but most of that has yet to be spent.