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Thursday, June 11, 2009

Obama Spending Makes Deficit Problem Worse

The basics of a budget are really very simple, when you are in massive debt (have a deficit) you quit spending, you do not spend more.

There, simple really.

When you have a shovel and are digging a hole and you see you might not be able to climb out of the hole, the first, smart thing to do, is quit digging and put the damn shovel away.

Obama's massive spending plans show he keeps on digging.


You can think of that roughly $2 trillion swing as coming from four broad categories: the business cycle, President George W. Bush’s policies, policies from the Bush years that are scheduled to expire but that Mr. Obama has chosen to extend, and new policies proposed by Mr. Obama.

As The Corner points out, it is only fair Bush take his share of the blame for the deficit, the Republicans under Bush as well as Bush, spent like drunks and allowed everyone else to do so as well... there is no denial of that here.

Two things are missing in Leonhardt’s thoughtful analysis. First is a recognition that much of the Obama spending so far is a quantitative leap beyond that attempted by President Bush. Yes, we had a stimulus package under Bush, but Obama’s was five times greater. And the auto bailouts and socialized medicine, which were not seen in the Bush administration, are coming with a ten-figure price tag. The deficit in Obama’s first year in office alone may well exceed the deficit for the entire eight years of Bush’s presidency.

Definitely go read the rest of that.

Obama's plan and massive spending now, will not address this, will not fix it but will, instead, make things worse.

More from NYT:

Alan Auerbach, an economist at the University of California, Berkeley, and an author of a widely cited study on the dangers of the current deficits, describes the situation like so: “Bush behaved incredibly irresponsibly for eight years. On the one hand, it might seem unfair for people to blame Obama for not fixing it. On the other hand, he’s not fixing it.”

“And,” he added, “not fixing it is, in a sense, making it worse.”

Obsidian Wings hits the nail directly on the head.

It is also unhelpful to divide the share of the deficit that is unambiguously part of Obama's agenda -- and easiest to change -- into three slices (yellow, green, and grey) and then argue, as Yglesias does, that Obama's agenda is reflected only in the smallest (grey) slice. That's can't be right: The stimulus package is clearly part of Obama's agenda: Obama proposed, fought for, and signed it. Whose agenda was it, if not Obama's? So are the policies that Bush proposed but that Obama adopted as part of Obama's agenda (yellow). Slice it however you like, a third of 2009's deficit is caused by Obama's agenda -- which also accounts for proportionately more in future deficits.

Yglesias is correct that we need to treat today's and tomorrow's deficits as "a ... practical problem that will have to be solved." To do that, we can't start by pushing the blame for the vast majority of today's deficit onto someone else when much of it is under our -- and Obama's -- control.

I may not agree with them on many social issues, nor political, but they show intellectual honesty in admitting that while Bush takes the blame for much of the proposed deficits, Obama is making it worse, not better, and still he has that shovel, continues to dig, and doesn't seem to care that he, thereby we, might never be able to crawl out of the larger hole he is creating.