By Veronique de Rugy Saturday, February 6, 2010
Filed under: Government & Politics, Economic Policy, Numbers, Public Square
President Obama has been in the White House for more than a year now, but he hasnâ??t yet gotten tired of telling the American people that the terrible fiscal outlook is the product of the Bush administrationâ??s policies. This is an excerpt from his budget message released on Monday (see p. 3): "On the day my administration took office, we faced an additional $7.5 trillion in national debt by the end of this decade as a result of the failure to pay for two large tax cuts, primarily for the wealthiest Americans, and a new entitlement program. We also inherited the worst recession since the Great Depressionâ??which, even before we took any action, added an additional $3 trillion to the national debt."
The Bush-era deficits were bad. I spent a great deal of time in the last eight years protesting our last presidentâ??s lack of fiscal responsibility (here and here, for instance). And yes, a large part of the fiscal 2009 deficit was the result of policies instituted by Bush during his last year in office.
But those are hardly reasons to keep adding to the deficit.
Using data in President Obamaâ??s budget request for fiscal 2010 and data from the fiscal 2011 budget request, the following chart projects spending each year from fiscal 2010 until fiscal 2019. The purple bars represent the spending amounts the president requested in February 2009. The orange bars represent the growth in the projected spending request between February 2009 and February 2010.
In his latest budget request, President Obama added roughly $1.6 trillion in spending over the next ten years on top of what he requested last year. Can President Obama blame that extra $1.6 trillion on former President Bush?
To be sure, the president's new budget data admits to a gigantic deficit in fiscal 2010. But it insists that smaller deficits are in our future. In fact, the president projects that the deficit will shrink to $700 billion in fiscal 2013.
I would take these projections with a grain of salt. Again, in February 2009, President Obama projected that the deficit for fiscal 2010 would be $1.2 trillion (Table S-1). This year, we find out that the deficit for fiscal 2010 will actually reach $1.6 trillion (Table S-1). And spending, which was projected to go down in fiscal 2010 to $3.6 trillion from its $3.9 trillion fiscal 2009 level, will climb by an estimated 6 percent by the end of the fiscal year to $3.7 trillion.
Overall, the president might have inherited a large deficit. But he has been adding to it as fast as he possibly can.
Veronique de Rugy is a senior research fellow at The Mercatus Center at George Mason University.
Image by Darren Wamboldt/Bergman Group.
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