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Bruce Bartlett, a supply-side economist who worked in the Reagan Treasury, says the budget deficit if Republican candidate John McCain were elected would have been nearly as big as the one the Obama White House is projecting for the current fiscal year.
Back in January, before Obama took office, the Congressional Budget Office projected a budget deficit of $1.186 trillion for 2009. It now projects a deficit of $1.587 trillion this year, a $401 billion increase.
In an email this morning, Mr. Bartlett points out that “If one goes through the March update (pp. 6-7) and the August update (pp. 52-53) and adds up all the changes to the January estimate, you find that the deficit increase since January consists of $46 billion in lower than expected revenues due to the economy (11.5%), $129 billion in higher spending due to technical re-estimates (32.2%), and $226 billion due to legislative changes to both spending and revenues (56.3%).
“This suggests that we would have had a deficit of at least $1,361 billion this year even if McCain had won (January deficit plus lower revenues and technical changes and no legislative changes),” he writes - and, “that’s assuming no stimulus and that the economy would have performed as well without it.
“That's only 14% less than the deficit currently projected,” said Mr. Bartlett. Plus, ”some of the legislative changes are due to higher defense spending and other non-stimulus related programs,” he said.
Mr. Bartlett said Mr. McCain “undoubtedly would have supported some sort of fiscal stimulus,” but “It might have been more tax- than spending-oriented, [which] would have increased the deficit nevertheless.
“If we assume that McCain's stimulus would have been half the size of Obama's that leaves us with an estimated deficit of $1,474 billion under McCain—only 7% less than the deficit now estimated,” he concludes.
Mr. Bartlett has been loudly warning for some time that – like it or not – tax increases are inevitable, given the dimensions of the federal deficit and the bipartisan affection for government spending.
He also is the author of a forthcoming book called The New American Economy: The Failure of Reaganomics and a New Way Forward.
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Mary Brown
You can’t be serious. Do you honestly believe the arctic ice cap is not melting? My eyes were wide open when I visited Bafin Island in May of ‘08 and saw for myself the clear evidence of global warming. Areas that 30 years ago could only be reached by snowmobile or dogsleds are now barren ground. The Barnes Ice Cap is nearly 6ft thinner. I am not an Al Gore follower but I also don’t let scientific facts be corrupted by political dogma. I suggest you take a trip to Alaska or northern Canada and you will see the evidence is irrefutable.
Tim:
Mary Brown’s correct re: the polar ice thingy. moreover, the earth’s average temperature is cooling, not heating. i recommend a little more research before your next post.
furthermore, it’s been empirically proven that cutting marginal income tax rates increases GDP growth faster & by a greater amount does Govt borrowing for fiscal stimulus. i recommend you read C. Romer’s late 2008 study, before she joined President Obama’s administration & drafted his fiscal stimulus plan. and her tax cut “bait & switch” between these two is interesting (and entertaining).
oh, and the only folks i’ve heard being called “un-American” are those who dare to question President Obama’s socialized medicine scheme. in fact, i think it was Pelosi herself in a recent op-ed. yep, i’m positive it was Pelosi.
why not cut taxes for the 1%? they pay most of the federal taxes, anyway. after the EITC, almost 60% of Americans pay ZERO federal income tax.
ps - I’m not a Republican & I’m confident those who know me would not label me ‘conservative’
Hey Tim…the icecaps aren’t melting. Antarctica’s is ice is growing slowly or steady state. That’s well known scientifically but inconveniently ignored by Al Gore legions. Open your eyes. There are two sides to every story.
The initial $787,000,000,000 Obama stimulus was tribute for his constituents support. Vanished with only a ripple and much more stimulus to come. Government spending has no velocity. True for FDR and true for Obama. The President has never been the manager of the economy and Obama, despite belief in his prowess, won’t be the manager anymore than Gordon Brown PM UK is the manager of the UK economy. The economy is stalled because consumers aren’t spending. Consumers aren’t spending because they are, in majority, debtors and deadbeats.
“That's only 14% less than the deficit currently projected,” said Mr. Bartlett. Plus, ”some of the legislative changes are due to higher defense spending and other non-stimulus related programs,” he said.
14% of a huge number is a huge number. A 14% a year difference in spending is enormous. It’s is the difference between bankrupting the country and having a fighting chance.
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