Tuesday, October 2, 2012

Spending our way to a better future...

At the end of this fiscal year, we'll have a deficit of over $1 trillion.  This will be the fourth straight year that we have a deficit this high.  When Obama took office, the CBO budget estimated that the deficit would be $1.2 trillion.  After Obama took office and by the end of the fiscal year, the deficit was actually $1.4 trillion.  The deficit was $1.3 trillion in 2010 and 2011 and about $1.2 trillion for the fiscal year that just ended.  On television, Obama cliaimed that his policies were only about 10% of the actual deficit and 90% of it was George W. Bush.  The American Recovery and Reinvestment Act of 2009, aka the stimulus, has added $800 billion to the deficit by 2011. The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 extended the Bush tax cuts and cut the Social Security payroll tax for two years, as well as provided relief to some taxpayers who otherwise would have had to pay the alternative minimum tax and cost about $800 billion in 2011 and 2012.  He is responsible therefore for over $2 billion of the deficits. 

The Treasury Department put plame on Obama for 12% of the deficit and Bush at 59% for the deficits we're seeing over the last ten years.  But it excludes 2012 fiscal year.  It also puts all of the blame for the Bush tax cuts (blame for what it's doing to the deficit) on Bush.  Despite the expanisions Obama put through and the extensions.  It misses some of the cost to the deficit from the Obama tax cut.  Yes, Obama cut taxes.  Some of the assignment of Obama's tax cut was put on Bush despite being out of office for three years.  Also, it might not give enough blame to Obama for spending more in Iraq and Afghanistan than was budgeted for.

The point of this post is that Obama is minimizing his responsibility to the deficits by quoting the Treasury's study, which is regrettable.  But all this finger-pointing misses the larger, overarching point, where do we go from here, what plans do we use to reduce these over the long term, and who has these plans?

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