Um, no. Go read Glenn — he was asking a question, not putting forth an argument.
Historically, the only countries that default on their debt are ones where the confluence of three things occur:
1) The government continues down a course from running larger and larger deficits, moving from a lack of fiscal discipline to near fiscal recklessness. Economic symptoms include rising interest rates, hyperinflation, and very high debt-to-GDP ratios. Not necessarily related but often correlated, such countries typically derive a large portion of their national income from the export of natural resources (oil, gas, metals, etc.) and sometimes commodities (when there is a poor and destabilizing balance of trade).
2) There is a mixture of public corruption, incompetence, and lack of accountability to the public (a sign of a weak, weakening, or non-existent democratic political system). Political and cultural symptoms include authoritarian tendencies (e.g., strong hierarchy, weak separation between military and civilian authority, strong cultural respect / deference for authority), bribery as accepted practice, and lack of financial and fiscal transparency.
3) Socialist or mercantilist principles run deep through the government executive levels; the president / dictator / ruler believes in political economy and command-and-control concepts, vs. the idea that the government is at best symbiotic with the economy, and at worst a life-draining parasite. The leaders of the country have the political will and authority to do things like nationalize companies and significant industries / parts of the economy, set interest rates and print money, seize private monetary assets and capital, and dictate or control commercial interests and trade.
Unsurprisingly, default crises have most usually occurred in countries like Ecuador, Mexico, Argentina, Brazil, Russia, throughout Africa, and in today’s news, Greece and possibly Venezuela are trending precariously in that direction.
As you can see from the above, much of what it takes to actually default on debt is deeply inconsistent with capitalist and libertarian principles. Any self-described libertarian would be deeply confused if he was advocating a public default, and in the American political system, public default of debt is nearly impossible to effect, even if a strong enough political and democratic majority existed to support it. People who call for the government to default on the debt are making unserious arguments and are either posturing, hyper-ideological (i.e. communist or socialist), supremely misguided and ill-informed, or some combination of these.
The true danger, and it is well worth highlighting and elevating concern about, is intentional inflation. Inflating the money supply is by far the easiest way for governments to relieve the burden of debt payments, albeit at a high cost to private wealth and economic growth. But the further removed you are from the capitalist belief system — that wealth is created from the ingenuity and efforts of relatively free actors pursuing their self-interests in a relatively free market — the easier it is to delude yourself into thinking that inflating your way out of debt is less harmful to society than curtailing government size, spending, and regulation. Hence, most of us to the right of Nancy Pelosi have serious concerns that our president and Congress are setting the stage for a long-term economic decline by single-mindedly pursuing big-spending, ideological-driven government intervention into the economy (i.e., stimulus, bailouts / takeovers, nationalization of the health-care sector, and so on), which must be inevitably supported by massive tax increases, hyperinflation, or a combination of both, since even the most optimistic scenarios show that economic recovery and GDP growth cannot possibly sustain this binge in the face of the impending wave of baby boomers retiring without serious reform to non-discretionary spending programs (i.e., Social Security and Medicare).
Brendan Loy
Go read Glenn — he was asking a question, not putting forth an argument.
I did read Glenn, and while you are technically correct, Glenn’s standard m.o. often involves sort of passive-agressively endorsing something by favorably referencing or (more often) linking to an article/argument about it, often in the form of a question or a snarky “heh” or a “hmm” or whatever, while maintaining plausible deniability as to whether he actually agrees. Perhaps this isn’t the best example of that, but it’s a decent enough one, and I think it’s fiar to surmise from his brief post that Glenn is at least open to this idea as being within the realm of reasonable or quasi-reasonable discourse and discussion, to which Bartlett is basically responding, “No, it’s not.” Even Glenn’s post-Bartlett “UPDATE” doesn’t clear things up: he says “I’m not trying to turn the United States into Zimbabwe,” but does that mean he’s disavowing the idea of default, or that he disagrees with Barlett’s analysis of what a default would do to the country? He doesn’t say. Readers are, again, left to guess what he means. But certainly, he doesn’t seem to be say anything nearly as strong as: “People who call for the government to default on the debt are making unserious arguments and are either posturing, hyper-ideological (i.e. communist or socialist), supremely misguided and ill-informed, or some combination of these.”
our president and Congress are setting the stage for a long-term economic decline by single-mindedly pursuing big-spending, ideological-driven government intervention into the economy (i.e., stimulus, bailouts / takeovers, nationalization of the health-care sector, and so on), which must be inevitably supported by massive tax increases, hyperinflation, or a combination of both, since even the most optimistic scenarios show that economic recovery and GDP growth cannot possibly sustain this binge in the face of the impending wave of baby boomers retiring without serious reform to non-discretionary spending programs (i.e., Social Security and Medicare).
I agree with that, but I’d add that, long before our current president and our current Congress did anything, it was already true, and known, that GDP growth could not possibly sustain current spending levels in the face of the impending wave of baby boomers retiring without serious reform to non-discretionary spending programs. This has been discussed by wonks, and ignored by the public and politicians and the press, for years. So let’s not pretend, as the GOP and the Tea Party movement and Fox News etc. would like us to, that this is something that just fucking happened in the last 13 months, mmmkay?
Now, has Obama made things worse? Perhaps, although there’s a strong argument that short-term deficit spending in 2009 was completely justified, and the real crime was that Obama was given such a shitty starting point, deficit- and debt-wise, given that it HASN’T really been justified at any time in the prior few decades. In any case, it would have been utter insanity to go nuclear on the debt/deficit problem in 2009, when doing so would surely have worsened the recession (and thus killed federal revenues even more) … and it’s still awfully risky now, lest the economy stagnate or even go into a double-dip recession. Obama’s caught between a rock and a hard place, and there are no good answers. And the GOP is only too happy to take advantage of that fact, and blame him for everything like a bunch of amnesiacs/liars, and mock him mercilessly whenever he points out the 100% true fact that he inherited this impossible situation.
Now, it’s fine, sort of, that GOP is taking advantage of Obama being in a tough spot — all’s fair in love and politics — but the whole thing is rather galling to anyone with a goddamn brain and a memory that goes back more than 13 months, considering that the Republican-dominated government of 2000-2006 did nothing whatsoever to address the known problem of the looming debt/deficit crisis you refer to, and in fact made things worse with (among other things) the Medicare prescription-drug program, which, unlike Obama’s centrist health-care reform package, didn’t even attempt to pay for itself (we can certainly argue about whether the estimates that say ObamaCare would pay for itself are too rosy, and we can likewise argue about whether the devices being used to make it “pay for itself” should instead be used to actually reduce the damn deficit against the current baseline, instead of paying for new spending — but at least there’s some sort of an effort to pay for the reform, unlike what the GOP Congress and GOP president Bush did). Being lectured by these people on the perils of deficits and debts, without any sense of remorse or accountability for their role in creating / worsening / failing to tackle the crisis when they had the power to do something about it, is just incredibly difficult to take. Moreover, in a more forward-looking sense, talk to me when the GOP has institutionally embraced something like Paul Ryan’s plan. Until then, we may be f***ed under Obama and Pelosi and Schumer (Reid’s days are numbered), but I see absolutely no reason whatsoever to believe we’d be any less f***ed under Romney/Palin/Pawlenty and Boehner and McConnell.
gahrie
the Medicare prescription-drug program, which, unlike Obama’s centrist health-care reform package, didn’t even attempt to pay for itself ……but at least there’s some sort of an effort to pay for the reform, unlike what the GOP Congress and GOP president Bush did)
Just for the record, the primary Democratic opposition was that the bill didn’t spend more money and provide more extensive coverage.
Even Glenn’s post-Bartlett “UPDATE” doesn’t clear things up: he says “I’m not trying to turn the United States into Zimbabwe,” but does that mean he’s disavowing the idea of default, or that he disagrees with Bartlett’s analysis of what a default would do to the country? He doesn’t say. Readers are, again, left to guess what he means.
The whole point of the bulk of my previous post (i.e. outlining who defaults and why, and contrasting that with capitalist / free market / libertarian principles) was to make it clear that the likelihood Glenn was seriously proposing default was slim to none, if you care to give him credit for having any intellectual and ideological consistency whatsoever. Beyond that, do you really think Glenn has even an ounce of belief that defaulting on our debt wouldn’t be a massive shock to the world economy? What kind of idiot do you take him for? His You can read in between the lines whatever you like, but both you and Bartlett are way overreacting, and Glenn’s update to the Zimbabwe accusation should have made that clear (not to mention, it’s silly that you think Glenn could think defaulting wouldn’t lead to Zimbabwe-like economic reverberations).
I agree with that, but I’d add that, long before our current president and our current Congress did anything, it was already true, and known, that GDP growth could not possibly sustain current spending levels in the face of the impending wave of baby boomers retiring without serious reform to non-discretionary spending programs. This has been discussed by wonks, and ignored by the public and politicians and the press, for years.
Sure everyone knew the impending crises from Social Security and Medicare was coming, but let’s be clear about who was blocking reform — it wasn’t the GOP. Bush went for reform in 2005 and the Dems crucified and paralyzed the GOP, much as the GOP has recently been able to do with Obamacare. And yes, Bush passed the Medicare Rx bill, but that was much less costly than the alternative the Dems were pushing, which was a relative Lexus compared to Bush’s Toyota. Bush and the Republicans were hardly fiscal saints, but in retrospect, what Obama and the Dems have accomplished makes the GOP years look downright responsible.
Now, has Obama made things worse? Perhaps, although there’s a strong argument that short-term deficit spending in 2009 was completely justified, and the real crime was that Obama was given such a shitty starting point, deficit- and debt-wise, given that it HASN’T really been justified at any time in the prior few decades. In any case, it would have been utter insanity to go nuclear on the debt/deficit problem in 2009, when doing so would surely have worsened the recession (and thus killed federal revenues even more) … and it’s still awfully risky now, lest the economy stagnate or even go into a double-dip recession. Obama’s caught between a rock and a hard place, and there are no good answers. And the GOP is only too happy to take advantage of that fact, and blame him for everything like a bunch of amnesiacs/liars, and mock him mercilessly whenever he points out the 100% true fact that he inherited this impossible situation.
Oh poor Obama — he inherited thorns instead of roses! Wait, he did want/I> to be president, didn’t he? I mean, it sure seemed like he wanted to be president in the worst way back in the fall of 2008, and that he was fulfilling history’s destiny in his January 2009 inauguration. Boy, did he have ALL the answers to ALL our problems; he was the Messiah!
But wait, now he and his followers wants us to throw him a pity party? He “inherited” a historically tough situation? But isn’t he history’s Messiah – just the man to bring “hope and change” when it’s so obviously and desperately needed? I’m sorry, but boo-fucking-hoo. You play the hand you’re dealt. Let’s not forget, Bush inherited a stock market bubble and crash, and a subsequent recession, and then 9/11, so it’s not like his tenure started off all peaches and cream either. Clinton was relatively lucky, as “his” recession technically ended more than a year before he entered office. Whining about what Obama “inherited” is about the weakest political excuse you can conjure.
As for deficits and debts, from 2001-2008, Bush increased the public debt by $2.4T and from 35% to 41% of GDP. In just two years, Obama will have added $4T to the public debt and raised debt to 67% of GDP. What Bush did may not have been justified, but what Obama has already done in his limited time in office is downright alarming.
In any case, I’ll be charitable and ignore the debt/deficit issue, because in my opinion, if Obama had proposed $787B in tax cuts instead of spending increases, the deficit/debt numbers would essentially be the same and conservatives would be cheering instead of booing (not to mention, it would’ve been much more effective in jump-starting the economy). What we are really concerned about going forward is the level of public spending that Obama is setting in motion (and we shudder to think how much worse it would’ve gotten if Obamacare had gone through).
This is an average annual budget growth rate of 6.3% Annual spending exceeded the conservative’s favorite TEL (tax and expenditure limitation) of inflation-plus-population growth by 2.5% a year (we averaged 2.8% annual inflation from 2001 to 2008, and the population growth averaged 1% a year). Keep in mind he started in a recession and then had to deal with the GWOT (including jumpstarting DHS and ODNI and the not-so-cheap Iraq war).
Now Obama:
2010: $3.55T (14.5%)
2011 (submitted, and it will only go up from here): $3.83T (7.9%)
That’s a spending growth rate of 11.2% a year (78% higher than Bush’s average), and exceeds the same TEL by roughly 9% (assuming 1% population growth and 1% inflation, even though we’ve been in deflation thus far) — over three times Bush’s average. Plus Obama gets to wind down the Iraq war and reap the [relatively minor] peace dividend (assuming Afghanistan spending doesn’t rise in negative correlation to Iraq savings).
So, if you want to argue Bush spent too much, I won’t disagree, but it’s ludicrous to argue that Bush’s irresponsibility means Obama has to double and triple on Bush’s bad spending habits (as if Bush’s budgets caused this recession). And let me also remind you who has controlled the federal purse strings since 2007 (hint: not the GOP).
Now that we’ve established the relative sainthood of Bush and the GOP as drunken sailors, that is why I said in the original comment that we simply can’t get whole again simply with GDP growth and without massive tax increases and/or hyperinflation plus radical structural reform to mandatory spending. Under the way the GOP was running (and proposing to run) things, sustaining their outlays without structural reform to entitlement programs was not realistic, but neither did it necessarily require resorting to massive tax increases or hyperinflation. Obama has significantly raised the stakes and made the job that much harder by baselining a much, much larger federal government. If he had instituted a temporary tax cut instead, at least that would have expired (presumably after an economic recovery), and tax revenues would quickly rebound to government spending held in check, rapidly shrinking the massive deficits and holding the line on the debt from runaway increase as a percentage of GDP.
And if Obamacare had passed? I’m sorry but trying to argue the Dems actually attempted to honestly pay for Obamacare is either pure deception or an argument from unacceptable ignorance on your part. Virtually every analysis of their proposal showed how their spending relied on unrealistic cuts to Medicare that are 100% likely to be restored before they are scheduled to go into effect, and that the true costs escalate but conveniently do not mushroom uncontrollably until just outside of the 10-year projection window required as part of the budget process.
The truth of the matter is that while Bush and the GOP didn’t do much to help our long-term fiscal prognosis, they didn’t screw us over either by doubling down on insane spending programs and economic interventions; they frittered away opportunities to make structural reforms (which were nonetheless opposed vehemently by Democrats anyway), but they didn’t do anything worse than merely maintain the spending inertia that had been in place since the mid-90s (their fiscal “crime” was cutting taxes and putting money back in the hands of taxpayers without corresponding decreases in government spending). Obama and the Dems, on the other hand, have damn near crippled our potential to rein in federal spending, and if they are successful in implementing even half of their remaining agenda (Obamacare, cap-and-trade plus an explosion in subsidies to “green” energy and technologies, implementing union-friendly and protectionist policies, and federalizing the home and educational lending markets), we are utterly fucked well beyond the worst of what the Republicans ever could have accomplished.
Alasdair
Brendan – if Booosh is such an eeeevil President, and the GOP his arch-minions, then what happened when the noble Dems took control of both Houses of Congress in January, 2007 ?
What budgetary programs did Pelosi/Reid courageously put forth in 2007-2008 to make “some sort of an effort to pay for the reform, unlike what the GOP Congress and GOP president Bush did” only to see their best efforts thwarted by the Veto of the Eeeevil Booosh ?
The GOP Bush + GOP Congress budgets somehow were managing to gradually reduce the size of the annual budgetary deficits after 9/11 had been prevented from becoming a recession … it wasn’t until the effects of GOP Bush + Dems Congress Budgets (with Obama as one of the Senators) that those lessenings of the annual Federal budgetary deficits went into reverse and have been accelerating in magnitude pretty much since … of course, with Dem Obama + Dems Congress as comparison, GOP Bush + GOP Congress Budgets look like paragons of thriftiness-on-steroids …
trooperbari
I’m all for whatever will turn the US into a proper, test-playing nation.
Alasdair
trooperbari – you are being way too subtle for this blog – and that’s not Cricket, old chap … these ex-Colonials are much more used to the Softball side of the Great Game …
“Is [Glenn] Reynolds really willing to turn the U.S. into Zimbabwe just to make a point?” http://bit.ly/96RYpx
To some of us, it seems like Pres. Obama is the one doing his best to emulate Mr. Mugabe.
Um, no. Go read Glenn — he was asking a question, not putting forth an argument.
Historically, the only countries that default on their debt are ones where the confluence of three things occur:
1) The government continues down a course from running larger and larger deficits, moving from a lack of fiscal discipline to near fiscal recklessness. Economic symptoms include rising interest rates, hyperinflation, and very high debt-to-GDP ratios. Not necessarily related but often correlated, such countries typically derive a large portion of their national income from the export of natural resources (oil, gas, metals, etc.) and sometimes commodities (when there is a poor and destabilizing balance of trade).
2) There is a mixture of public corruption, incompetence, and lack of accountability to the public (a sign of a weak, weakening, or non-existent democratic political system). Political and cultural symptoms include authoritarian tendencies (e.g., strong hierarchy, weak separation between military and civilian authority, strong cultural respect / deference for authority), bribery as accepted practice, and lack of financial and fiscal transparency.
3) Socialist or mercantilist principles run deep through the government executive levels; the president / dictator / ruler believes in political economy and command-and-control concepts, vs. the idea that the government is at best symbiotic with the economy, and at worst a life-draining parasite. The leaders of the country have the political will and authority to do things like nationalize companies and significant industries / parts of the economy, set interest rates and print money, seize private monetary assets and capital, and dictate or control commercial interests and trade.
Unsurprisingly, default crises have most usually occurred in countries like Ecuador, Mexico, Argentina, Brazil, Russia, throughout Africa, and in today’s news, Greece and possibly Venezuela are trending precariously in that direction.
As you can see from the above, much of what it takes to actually default on debt is deeply inconsistent with capitalist and libertarian principles. Any self-described libertarian would be deeply confused if he was advocating a public default, and in the American political system, public default of debt is nearly impossible to effect, even if a strong enough political and democratic majority existed to support it. People who call for the government to default on the debt are making unserious arguments and are either posturing, hyper-ideological (i.e. communist or socialist), supremely misguided and ill-informed, or some combination of these.
The true danger, and it is well worth highlighting and elevating concern about, is intentional inflation. Inflating the money supply is by far the easiest way for governments to relieve the burden of debt payments, albeit at a high cost to private wealth and economic growth. But the further removed you are from the capitalist belief system — that wealth is created from the ingenuity and efforts of relatively free actors pursuing their self-interests in a relatively free market — the easier it is to delude yourself into thinking that inflating your way out of debt is less harmful to society than curtailing government size, spending, and regulation. Hence, most of us to the right of Nancy Pelosi have serious concerns that our president and Congress are setting the stage for a long-term economic decline by single-mindedly pursuing big-spending, ideological-driven government intervention into the economy (i.e., stimulus, bailouts / takeovers, nationalization of the health-care sector, and so on), which must be inevitably supported by massive tax increases, hyperinflation, or a combination of both, since even the most optimistic scenarios show that economic recovery and GDP growth cannot possibly sustain this binge in the face of the impending wave of baby boomers retiring without serious reform to non-discretionary spending programs (i.e., Social Security and Medicare).
Go read Glenn — he was asking a question, not putting forth an argument.
I did read Glenn, and while you are technically correct, Glenn’s standard m.o. often involves sort of passive-agressively endorsing something by favorably referencing or (more often) linking to an article/argument about it, often in the form of a question or a snarky “heh” or a “hmm” or whatever, while maintaining plausible deniability as to whether he actually agrees. Perhaps this isn’t the best example of that, but it’s a decent enough one, and I think it’s fiar to surmise from his brief post that Glenn is at least open to this idea as being within the realm of reasonable or quasi-reasonable discourse and discussion, to which Bartlett is basically responding, “No, it’s not.” Even Glenn’s post-Bartlett “UPDATE” doesn’t clear things up: he says “I’m not trying to turn the United States into Zimbabwe,” but does that mean he’s disavowing the idea of default, or that he disagrees with Barlett’s analysis of what a default would do to the country? He doesn’t say. Readers are, again, left to guess what he means. But certainly, he doesn’t seem to be say anything nearly as strong as: “People who call for the government to default on the debt are making unserious arguments and are either posturing, hyper-ideological (i.e. communist or socialist), supremely misguided and ill-informed, or some combination of these.”
our president and Congress are setting the stage for a long-term economic decline by single-mindedly pursuing big-spending, ideological-driven government intervention into the economy (i.e., stimulus, bailouts / takeovers, nationalization of the health-care sector, and so on), which must be inevitably supported by massive tax increases, hyperinflation, or a combination of both, since even the most optimistic scenarios show that economic recovery and GDP growth cannot possibly sustain this binge in the face of the impending wave of baby boomers retiring without serious reform to non-discretionary spending programs (i.e., Social Security and Medicare).
I agree with that, but I’d add that, long before our current president and our current Congress did anything, it was already true, and known, that GDP growth could not possibly sustain current spending levels in the face of the impending wave of baby boomers retiring without serious reform to non-discretionary spending programs. This has been discussed by wonks, and ignored by the public and politicians and the press, for years. So let’s not pretend, as the GOP and the Tea Party movement and Fox News etc. would like us to, that this is something that just fucking happened in the last 13 months, mmmkay?
Now, has Obama made things worse? Perhaps, although there’s a strong argument that short-term deficit spending in 2009 was completely justified, and the real crime was that Obama was given such a shitty starting point, deficit- and debt-wise, given that it HASN’T really been justified at any time in the prior few decades. In any case, it would have been utter insanity to go nuclear on the debt/deficit problem in 2009, when doing so would surely have worsened the recession (and thus killed federal revenues even more) … and it’s still awfully risky now, lest the economy stagnate or even go into a double-dip recession. Obama’s caught between a rock and a hard place, and there are no good answers. And the GOP is only too happy to take advantage of that fact, and blame him for everything like a bunch of amnesiacs/liars, and mock him mercilessly whenever he points out the 100% true fact that he inherited this impossible situation.
Now, it’s fine, sort of, that GOP is taking advantage of Obama being in a tough spot — all’s fair in love and politics — but the whole thing is rather galling to anyone with a goddamn brain and a memory that goes back more than 13 months, considering that the Republican-dominated government of 2000-2006 did nothing whatsoever to address the known problem of the looming debt/deficit crisis you refer to, and in fact made things worse with (among other things) the Medicare prescription-drug program, which, unlike Obama’s centrist health-care reform package, didn’t even attempt to pay for itself (we can certainly argue about whether the estimates that say ObamaCare would pay for itself are too rosy, and we can likewise argue about whether the devices being used to make it “pay for itself” should instead be used to actually reduce the damn deficit against the current baseline, instead of paying for new spending — but at least there’s some sort of an effort to pay for the reform, unlike what the GOP Congress and GOP president Bush did). Being lectured by these people on the perils of deficits and debts, without any sense of remorse or accountability for their role in creating / worsening / failing to tackle the crisis when they had the power to do something about it, is just incredibly difficult to take. Moreover, in a more forward-looking sense, talk to me when the GOP has institutionally embraced something like Paul Ryan’s plan. Until then, we may be f***ed under Obama and Pelosi and Schumer (Reid’s days are numbered), but I see absolutely no reason whatsoever to believe we’d be any less f***ed under Romney/Palin/Pawlenty and Boehner and McConnell.
the Medicare prescription-drug program, which, unlike Obama’s centrist health-care reform package, didn’t even attempt to pay for itself ……but at least there’s some sort of an effort to pay for the reform, unlike what the GOP Congress and GOP president Bush did)
Just for the record, the primary Democratic opposition was that the bill didn’t spend more money and provide more extensive coverage.
Even Glenn’s post-Bartlett “UPDATE” doesn’t clear things up: he says “I’m not trying to turn the United States into Zimbabwe,” but does that mean he’s disavowing the idea of default, or that he disagrees with Bartlett’s analysis of what a default would do to the country? He doesn’t say. Readers are, again, left to guess what he means.
The whole point of the bulk of my previous post (i.e. outlining who defaults and why, and contrasting that with capitalist / free market / libertarian principles) was to make it clear that the likelihood Glenn was seriously proposing default was slim to none, if you care to give him credit for having any intellectual and ideological consistency whatsoever. Beyond that, do you really think Glenn has even an ounce of belief that defaulting on our debt wouldn’t be a massive shock to the world economy? What kind of idiot do you take him for? His You can read in between the lines whatever you like, but both you and Bartlett are way overreacting, and Glenn’s update to the Zimbabwe accusation should have made that clear (not to mention, it’s silly that you think Glenn could think defaulting wouldn’t lead to Zimbabwe-like economic reverberations).
I agree with that, but I’d add that, long before our current president and our current Congress did anything, it was already true, and known, that GDP growth could not possibly sustain current spending levels in the face of the impending wave of baby boomers retiring without serious reform to non-discretionary spending programs. This has been discussed by wonks, and ignored by the public and politicians and the press, for years.
Sure everyone knew the impending crises from Social Security and Medicare was coming, but let’s be clear about who was blocking reform — it wasn’t the GOP. Bush went for reform in 2005 and the Dems crucified and paralyzed the GOP, much as the GOP has recently been able to do with Obamacare. And yes, Bush passed the Medicare Rx bill, but that was much less costly than the alternative the Dems were pushing, which was a relative Lexus compared to Bush’s Toyota. Bush and the Republicans were hardly fiscal saints, but in retrospect, what Obama and the Dems have accomplished makes the GOP years look downright responsible.
Now, has Obama made things worse? Perhaps, although there’s a strong argument that short-term deficit spending in 2009 was completely justified, and the real crime was that Obama was given such a shitty starting point, deficit- and debt-wise, given that it HASN’T really been justified at any time in the prior few decades. In any case, it would have been utter insanity to go nuclear on the debt/deficit problem in 2009, when doing so would surely have worsened the recession (and thus killed federal revenues even more) … and it’s still awfully risky now, lest the economy stagnate or even go into a double-dip recession. Obama’s caught between a rock and a hard place, and there are no good answers. And the GOP is only too happy to take advantage of that fact, and blame him for everything like a bunch of amnesiacs/liars, and mock him mercilessly whenever he points out the 100% true fact that he inherited this impossible situation.
Oh poor Obama — he inherited thorns instead of roses! Wait, he did want/I> to be president, didn’t he? I mean, it sure seemed like he wanted to be president in the worst way back in the fall of 2008, and that he was fulfilling history’s destiny in his January 2009 inauguration. Boy, did he have ALL the answers to ALL our problems; he was the Messiah!
But wait, now he and his followers wants us to throw him a pity party? He “inherited” a historically tough situation? But isn’t he history’s Messiah – just the man to bring “hope and change” when it’s so obviously and desperately needed? I’m sorry, but boo-fucking-hoo. You play the hand you’re dealt. Let’s not forget, Bush inherited a stock market bubble and crash, and a subsequent recession, and then 9/11, so it’s not like his tenure started off all peaches and cream either. Clinton was relatively lucky, as “his” recession technically ended more than a year before he entered office. Whining about what Obama “inherited” is about the weakest political excuse you can conjure.
As for deficits and debts, from 2001-2008, Bush increased the public debt by $2.4T and from 35% to 41% of GDP. In just two years, Obama will have added $4T to the public debt and raised debt to 67% of GDP. What Bush did may not have been justified, but what Obama has already done in his limited time in office is downright alarming.
In any case, I’ll be charitable and ignore the debt/deficit issue, because in my opinion, if Obama had proposed $787B in tax cuts instead of spending increases, the deficit/debt numbers would essentially be the same and conservatives would be cheering instead of booing (not to mention, it would’ve been much more effective in jump-starting the economy). What we are really concerned about going forward is the level of public spending that Obama is setting in motion (and we shudder to think how much worse it would’ve gotten if Obamacare had gone through).
Let’s look at the Bush budgets:
2002: $2.00T (5.2% increase over previous budget)
2003: $2.20T (10%)
2004: $2.30T (4.5%)
2005: $2.40T (4.3%)
2006: $2.70T (12.5%)
2007: $2.77T (2.6%)
2008: $2.90T (4.7%)
2009: $3.10T (6.9%)
This is an average annual budget growth rate of 6.3% Annual spending exceeded the conservative’s favorite TEL (tax and expenditure limitation) of inflation-plus-population growth by 2.5% a year (we averaged 2.8% annual inflation from 2001 to 2008, and the population growth averaged 1% a year). Keep in mind he started in a recession and then had to deal with the GWOT (including jumpstarting DHS and ODNI and the not-so-cheap Iraq war).
Now Obama:
2010: $3.55T (14.5%)
2011 (submitted, and it will only go up from here): $3.83T (7.9%)
That’s a spending growth rate of 11.2% a year (78% higher than Bush’s average), and exceeds the same TEL by roughly 9% (assuming 1% population growth and 1% inflation, even though we’ve been in deflation thus far) — over three times Bush’s average. Plus Obama gets to wind down the Iraq war and reap the [relatively minor] peace dividend (assuming Afghanistan spending doesn’t rise in negative correlation to Iraq savings).
So, if you want to argue Bush spent too much, I won’t disagree, but it’s ludicrous to argue that Bush’s irresponsibility means Obama has to double and triple on Bush’s bad spending habits (as if Bush’s budgets caused this recession). And let me also remind you who has controlled the federal purse strings since 2007 (hint: not the GOP).
Now that we’ve established the relative sainthood of Bush and the GOP as drunken sailors, that is why I said in the original comment that we simply can’t get whole again simply with GDP growth and without massive tax increases and/or hyperinflation plus radical structural reform to mandatory spending. Under the way the GOP was running (and proposing to run) things, sustaining their outlays without structural reform to entitlement programs was not realistic, but neither did it necessarily require resorting to massive tax increases or hyperinflation. Obama has significantly raised the stakes and made the job that much harder by baselining a much, much larger federal government. If he had instituted a temporary tax cut instead, at least that would have expired (presumably after an economic recovery), and tax revenues would quickly rebound to government spending held in check, rapidly shrinking the massive deficits and holding the line on the debt from runaway increase as a percentage of GDP.
And if Obamacare had passed? I’m sorry but trying to argue the Dems actually attempted to honestly pay for Obamacare is either pure deception or an argument from unacceptable ignorance on your part. Virtually every analysis of their proposal showed how their spending relied on unrealistic cuts to Medicare that are 100% likely to be restored before they are scheduled to go into effect, and that the true costs escalate but conveniently do not mushroom uncontrollably until just outside of the 10-year projection window required as part of the budget process.
The truth of the matter is that while Bush and the GOP didn’t do much to help our long-term fiscal prognosis, they didn’t screw us over either by doubling down on insane spending programs and economic interventions; they frittered away opportunities to make structural reforms (which were nonetheless opposed vehemently by Democrats anyway), but they didn’t do anything worse than merely maintain the spending inertia that had been in place since the mid-90s (their fiscal “crime” was cutting taxes and putting money back in the hands of taxpayers without corresponding decreases in government spending). Obama and the Dems, on the other hand, have damn near crippled our potential to rein in federal spending, and if they are successful in implementing even half of their remaining agenda (Obamacare, cap-and-trade plus an explosion in subsidies to “green” energy and technologies, implementing union-friendly and protectionist policies, and federalizing the home and educational lending markets), we are utterly fucked well beyond the worst of what the Republicans ever could have accomplished.
Brendan – if Booosh is such an eeeevil President, and the GOP his arch-minions, then what happened when the noble Dems took control of both Houses of Congress in January, 2007 ?
What budgetary programs did Pelosi/Reid courageously put forth in 2007-2008 to make “some sort of an effort to pay for the reform, unlike what the GOP Congress and GOP president Bush did” only to see their best efforts thwarted by the Veto of the Eeeevil Booosh ?
The GOP Bush + GOP Congress budgets somehow were managing to gradually reduce the size of the annual budgetary deficits after 9/11 had been prevented from becoming a recession … it wasn’t until the effects of GOP Bush + Dems Congress Budgets (with Obama as one of the Senators) that those lessenings of the annual Federal budgetary deficits went into reverse and have been accelerating in magnitude pretty much since … of course, with Dem Obama + Dems Congress as comparison, GOP Bush + GOP Congress Budgets look like paragons of thriftiness-on-steroids …
I’m all for whatever will turn the US into a proper, test-playing nation.
trooperbari – you are being way too subtle for this blog – and that’s not Cricket, old chap … these ex-Colonials are much more used to the Softball side of the Great Game …
On which note, Sagacity or Hypocrisy ?
You be the judge …