The Exploding Deficit

If you want to know why there is a Tea Party movement trying to get beyond partisanship to focus on results, just read this. The numbers are staggering. If Washington believes the Tea Party movement is a bunch of rubes who would let Rome burn by failing to support needed stimulus, I believe they may be mistaken. This is a pay me now, or pay me later problem. And many good Americans are unwilling to simply shove all this debt off onto their children.

Some excerpts:

The US budget deficit accelerated in March to hit a record nearly one trillion dollars just halfway through the current fiscal year, as the government moved to bail out troubled institutions, government data has shown. The deficit for the first six months of the fiscal year which began on October 1 was 956.80 billion dollars, according to the Treasury's monthly statement of receipts and outlays.

 The March deficit of 192.27 billion dollars was higher than the 160 billion dollars expected by most analysts, coming on the back of money poured by President Barack Obama's administration to rescue financial institutions.

All six months of the fiscal year so far recorded red ink. The last time the United States plunged into a consecutive six month deficit was during the October 2003-March 2004 period, officials said.

The nonpartisan Congressional Budget Office (CBO) forecast last month the budget deficit could hit 1.845 trillion dollars for the whole year based on Obama's 3.5-trillion-dollar budget plan approved by Congress early this month.

The CBO said its budget deficit estimate for fiscal 2009, which ends on September 30, would be four times the 2008 record shortfall and amount to 13.1 percent of the country's total economic output.

Comments

[Bob]

Riehl and other "tea party" advocates claim that their astroturf movement isn't about partisan politics. It's supposed to be based on honest principles like a concern for deficit spending by the federal government. But where was Riehl's concern for deficit spending during the entire Bush administration? Doing a Google search of Riehl World View, I found dozens of posts that featured variations on the word "deficit." However, almost every single one was from the period since Obama was elected, with a smattering from previous years that always referred to congressional Democrats. I didn't find a single example of Riehl criticizing the Bush administration for excessive spending.

So pardon me if I continue to believe that the Tea Party movement is nothing but an insincere partisan pose. Its real inspiration is that the rich people who like to dictate the terms of our national discourse are mad because they think the Obama administration is being mean to them. They don't want to have to give up their Bush tax cuts even for the well being of the nation, and they'll have a tantrum if someone makes them. The Republican Party and its apparatchiks in the conservative media and blogs are doing the bidding of these elites, as they always do, to try to stir up the rubes to go out and protest for the rights of rich people. The whole thing is about as phony and insincere as it could possibly be.

[24AheadDotCom]

Speaking of results, let's put on our thinking caps. Which is these would have the greater result?
1. Holding a party in a solid blue district on L.I. which was attended by just 0.2% of those who'd voted in the last election, or
2. A BarneyFrank vs. The Student incident with the Dem Rep. from that district, but with a very sharp trial lawyer replacing The Student and really pressing the Dem Rep. on flaws in the stimulus or other spending?

Anyone who's smart realizes the second would send a much, much stronger message. In fact, the first is counter-productive: it shows the Dem Rep. just how weak his opposition is.

Yet, Riehl, Insty, Pajamas, Fox, the Kochtopus, Armey, Norquist, and all the rest aren't suggesting the second but the first. Why is that?

P.S. The idea that the "parties" are "bipartisan" is beyond ludicrous. Objectivist loons like Insty are considered fringe even within the LibertarianParty.

P.P.S. I'm currently kinda looking at this in a DarwinAward fashion: I kinda want the leading lights to burn out on this. Hopefully then people will start to look for something more effective.

[Andrew_M_Garland]

To Bob,

What is your view of Obama's current, massive deficit spending (borrowing to spend)?

Is it good under Obama, but was bad under Bush?
Or, is it good under both? Or bad under both?

You seem to be in favor of deficit spending now. But, you criticise Riehl for not being sufficiently against it in the past. So, it seems that you are in favor of deficits when Democrats are in office, but against deficits when Republicans are in office.

You have exactly the same position that you are blaming on Riehl, but from the other side. Possibly you believe that deficit spending is always good for the party in power.

By good, I mean good for the country as a whole. Or, is politics properly a game of "get the spoils", in your opinion?

[Bob]

There was no serious rationale for deficit spending under Bush, other than the usual let's-be-nice-to-the-millionairs-and-maybe-they'll-share-some-with-the-rest-of-us trickle-down hoo-hah. The country had been doing exceptionally well under the Clinton presidency, and nobody, least of all the wealthy, had anything to complain about under his tax rate scheme. But good enough wasn't enough when Bush took office, and without any other reason than claiming that taxes are always bad, Bush slashed the tax rates and ushered in an era of increasing deficits. There was no economic crisis at the time to justify it. Some have even speculated that the tax cuts were INTENDED to worsen the deficit so that it could be used as a pretext to demolish programs like Social Security and Medicare, that have always been the bete-noires of the right wing. The problem with the Bush tax cuts is that they were done for no honest reason.

In contrast, Obama is following the well-established prescriptions of Keynesian economics, where the government is seen as the resource of last resort for a massively failing economy. A lot of Nobel-prize winning economists believe that this is the right approach. Meanwhile, a lot of well-respected economists also believe that the Hooverist approach of reigning-in spending and trying to pay-down debt is a recipe for disaster. We can have good-faith debates about the pros and cons of Obama's strategy, but nobody can claim that it is not a legitimate, responsible, honest and respectable course of action under these dire circumstances. It's not being done to pay off a political interest group the way Bush's tax cuts were.

Nobody wants to be in the position of having to do this. Nobody wants to have to engage in deficit spending as a means to revive a dying economy. But many responsible people think it's the only option that we have left. Conservatives got to have things their way for the previous eight years, and look at the mess we're in now. So it seems only fair to me that Obama -- now only a few months into his term -- and his supporters get to try it THEIR way for a change. Of course there are no guarantees it will work, but they should be given a fair chance.

In the meantime, conservatives are free to express their views. Unfortunately, what they're doing with this opportunity is unserious, dishonest political posturing. The Tea Party movement presents no responsible alternative to Obama's plan. It's just more appeals to hobble the national economy so that we don't have to ask even that the wealthy return to the tax rates they had under Clinton. If the conservatives can't even make such a small sacrifice for the sake of the country, then it seems about as un-patriotic as it could possibly be.

[SacTownMan]

Bob, that last dose of verbal Diarrhea was about as much as a sane thinking person could take!

"The country had been doing exceptionally well under the Clinton presidency"

"The problem with the Bush tax cuts is that they were done for no honest reason."

I can't "honestly" think of a "reason" that "anyone" would want to lower a staggering 39.6% marginal tax rate under Clinton and put more money in the hands of the middle class. Is that enough of an "honest reason" for you and your troll buddies Bob?

http://mjperry.blogspot.com/2008/03/comparing-income-taxes-clinton-vs-bush.html

"And in fact, the group in the chart above that experienced the largest percentage decrease in taxes were the married taxpayers with $50,000 of household income (clearly middle class by most definitions) - they paid 21% less in taxes under the Bush tax rates compared to the Clinton rates."

But keep sticking with the moonbat talking points, they work so well for you!

"A lot of Nobel-prize winning economists" or "Meanwhile, a lot of well-respected economists also believe". You must write a great term paper!

Way to provide links to prove your point Bob that sure works to convince me!

"If the conservatives can't even make such a small sacrifice for the sake of the country then it seems about as un-patriotic as it could possibly be."

http://blog.heritage.org/2009/03/24/bush-deficit-vs-obama-deficit-in-pictures/

A picture is worth a thousand words! Or is it 4 trillion or 5 trillion. I just can't be bothered by a silly trillion here or there!

As far as your great Xerxes he needs to get over his god complex long enough to remember that he works for us! The folks going to the Tea Parties" aren't cybertrollers like you. These are folks that are pissed that the people in power in Washington, both Dems and Repubs, are willing to allow a socialist conversion of the country to bigger government and higher taxes.

Oh and if you think for one minute that those folks that will be out on Wednesday are not true American patriots you are spending way too much time with your head up Barry and Uncle Georgies ass!

Since your so willing to give of yourself How about going down and volunteering some time at the homeless shelter this weekend to celebrate the risen Christ!

You want to be a patriot don't you?

[Bob]

Speaking of verbal diarrhea, SacTownMan, I see nowhere in your lengthy post any alternative to the so-called "socialist conversion" you appear to be so angry about. And that's the whole beef with the Tea Party movement. It's just a lot of aimless carping about a laundry list of conservative hot-button issues that contains no actual alternative solutions. It's like the recent GOP alternative budget that was full of grand-sounding pronouncements but had no actual numbers and no actionable plans. In short, it's just B.S., demagoguery and empty posturing. If any of them were sincere about it, they wouldn't have just started it up in the first couple of months of a Democratic presidency. And why doesn't someone address my earlier point about how Riehl never mentioned any concerns about deficits until AFTER Obama won the election?

[North Dallas Thirty]

"And why doesn't someone address my earlier point about how Riehl never mentioned any concerns about deficits until AFTER Obama won the election?"

Probably because it's obvious that you don't care one whit about deficits, given how you endorse and support Obama's deficits that are four and five times that of Bush's. Thus, that makes it obvious that you're merely attempting a diversionary and hypocritical tactic to avoid explaining why you support Obama's massive deficits.

Also, if you saw the graphic in question that SacTownMan posted, Bush's deficits got SMALLER over the past four years, mainly because, despite the tax cuts you whine about so much, Federal tax revenue set records for three consecutive years. You still can't explain that, so you ignore it. Typical.

Finally, despite all your whining about "sacrificing for the country", you still fully support and endorse the leaders of your party like Rangel, Solis, Sebelius, Daschle, Stark, Geithner, and others who refuse to pay their taxes while demanding that they be raised on others.

You want a solution? Cut taxes. Return the money to the people who earn it when they earn it instead of making them hand it over to the government as a forced interest-free loan that may or may not be given back to them, depending on whether there's money left over after giving Obama's illegal immigrant aunt subsidized housing, free healthcare, welfare checks, and a no-show government job, and whether or not they worked too hard and thus don't deserve it. Instead of believing as a welfare-addicted party like yours does that anyone who has money stole it from someone else, acknowledge the possibility that people might, just might have money because they CREATE WEALTH.

And then, if millionaire and billionaire leftists like Obama want to "feed the poor" or whatever, tell them they can do it out of their own pockets. But of course they don't REALLY want to do that; they just use "the poor" as an excuse to impose crushing taxes on others that they never pay themselves.

[Cheesecake]

Bob, I'm going to introduce you to something called a "tipping point."

People will tolerate a lot. Conservatives especially. You know why? Because it was 'justified' because we were just attacked: over 3000 civilians died to jihadists. We had a huge deficit the following year, and that deficit was shrinking every year until 2008. Then the bailouts. If you actually understood conservatives, then you might realize that a good deal of us did NOT like the bailouts to begin with. But once they passed them we decided "maybe it'll help. Too late to really do anything now." More bailouts. More frustration. At some point, alot of us decide "Its time to take a stand. The "tipping point" was the EXPLOSION of spending. Obama and Geithner have burned almost a trillion dollars since January. 3 months, and he's through a trillion in red ink. Bush didn't even preside over such a massive increase in spending. Obama's dwarfs him. Surely you've heard of the phrase "The straw that broke the camel's back." This is it. Tipping point: After so many bailouts with almost no signs of success or accountability, waste of record size, and what is on the horizon: MORE! Well we've had it.

There is another saying that you should keep in mind while blindly defending Obama's spending: "Debt makes the borrower slave to the lender." Its about goddamn time we get rid of this monstrous debt, start working up a huge surplus, and become a creditor nation. When others owe us money is when we'll have the advantage. And it is in America's BEST interests to have an advantage against anyone who would dare do us harm.

Also, one last point. You can't justify Obama's deficit by pointing the finger at Bush.

[Bob]

As I said earlier, there is a legitimate economic theory that is probably the dominant paradigm among professional economists that calls for large outlays of government spending to stimulate a failing economy. As anyone who pays attention to recent news should know, several prominent economists like Krugman and Stiglitz -- both of them Nobel Prize winners, by the way -- have said that Obama's stimulus plan isn't even large enough. Obama has already scaled back the stimulus plan for the sake of compromising with those who were concerned about deficits. But to cut back too much defeats the entire purpose of such a strategy. In a real crisis like this, there can be no half measures.

Where there might be good-faith arguments made for or against this Keynesian approach, what do you knuckle-heads offer? Lame explanations for why you belatedly came to be so "angry" about deficit spending. Like, "Because we were just attacked" (as if this is not just as serious of a crisis now); "Because it's obvious that you don't care one whit about deficits"(like my personal feelings have anything to do with your apparent tolerance of deficits during the entire time that Bush was in office). And the solutions you offer? "Cut taxes." No wonder everyone who's not a wing nut doesn't take you people seriously. You're running around making silly arguments like these, doing the bidding of your wealthy masters. What a bunch of rubes.

[MC]

It amuses me how ironic it is that the in the middle of the subprime loans crisis, there's a whole bunch of liberals who want to make the next subprime loan crisis, only next time, the crappy loans will be the government's huge deficit. They seem to manage to correctly damn and blast the recklessness, greed, over-confidence and underestimation of risk surrounding subprime loans, but go ahead and do the exact same thing when they regard government debt as the same sort of no risk bottomless pit of money that they can spend, spend, spend. It's exactly the sort of feckless greed they accuse Wall Street off. And just like the subprime mortgage crisis they'll let it continue and continue and never question the wisdom of it until the day the bubble bursts and a far worse crisis is precipitated. Let's all hope Obama doesn't get two terms.

[Jim Treacher]

Dear Bob:

http://pajamasmedia.com/instapundit/so-why-are-we-seeing-tea-parties-now-rather-than-back-in-the-bush-administration-its-important-t/

You're welcome.

[syn]

" several prominent economists like Krugman and Stiglitz -- both of them Nobel Prize winners, by the way"

Well that does it! Why of course, Keynesian economist Paul Krugman who advised Enron is the brilliant one because he has a Nobel Prize and believes that FDR did not spend quite enough tax dollars to bankrupt America into misery quick enough.

Clinton had a GREAT economy? Not from my view here in NYC in 1999 when the recession hit and so many were being laid from jobs and whatnot.

[Bob]

Your posts are a perfect example that the supposed concern for government debt has no coherent theory behind it and no practical alternatives to Obama's stimulus plan. Only pointless comparisons between the subprime bubble fueled by reckless investments and an emergency government program that has nothing whatsoever to do with speculative investments. Only the typical sort of anti-intellectual mockery of highly respected professional economists, when the pro-tea-party side has only know-nothing TV personalities like Glenn Beck as their supposed brain trust. So far, the only concrete alternative proposal I've seen in all of your posts is this truly laughable recommendation: "Tax cuts." You've got to be kidding me.

It's too bad, because there are probably some really significant areas where liberals and RESPONSIBLE, SERIOUS conservatives could agree. Like for example the bank bailout plan. Why are Wall Street executives and their institutions being shown so much deference by Geithner and Summers? As Krugman himself said recently, Geithner's bank stress tests are like a self-esteem class where everybody wins. Why are taxpayers being expected to foot the bill for these reckless institutions with so much lack of transparency and so little apparent power to fire the arrogant fools who ran them into the ground? But of course, in typical fashion, today's Fox News wing nuts are too busy with their little political theater and their unfocused displays of anger to accomplish anything responsible or constructive. It figures that a group who thought that a train-wreck like Sarah Palin was going to be their savior couldn't, as the Brits like to say, manage a piss-up in a brewery.

[Rick Caird]

It was fun to read Bob's posts. First, he is unclear on the difference between a deficit of about $400 billion and one of about $1.5 trillion. I guess to a liberal, those are roughly equivalent.

Second, in spite of Stiglitz and Krugman, Keynesian theory has never worked. It did not work during the depression and it did not work in Japan. In typical liberal fashion both Stiglitz and Krugman defend the failure of Keynesian economics by claiming we just did not do enough. But, even Keynes, in 1943 backed off on some of his general theory particularly the part on infrastructure spending.

All in all, Obama is proposing raising the national debt to $20 trillion. The carrying cost alone, at 5%, would be $1 trillion a year. Now couple that with both Social Security and Medicare going into deficit and the whole concept will simply not work. Why anyone thinks it will is beyond me.

Rick

[Bob]

Again, nobody wants to have to be in this crisis and to have to institute such desperate measures to try to rescue the economy. It's a once-in-a-generation crisis that could be compared in some ways to other great crises like World War II, which required even more desperate measures and took many years to pay down. The alternative to this expenditure at the time of WWII was military defeat. This time around, the alternative is to do nothing (or cut taxes on the wealthy and make things even worse) and risk the total collapse of the world economy.

People who criticize the current stimulus plan -- which is especially true of the tea partiers -- have no responsible or even coherent alternative. And ignorant, evidence-free statements like "Keynesian theory has never worked" provide neither a rationale to abandon the current approach nor a prescription for a different plan. Having tolerated excessive deficits without a peep when Bush incurred them for no good reason, tea partiers now expect to be taken seriously as their belated fear of deficits just happens to coincide with the first months of a Democratic administration that's forced by circumstances to take drastic measures.

But if conservatives had any real solutions to real problems, we wouldn't be in the current crisis after all, would we? The Republicans had eight years to prove to the country what their economic theories could do, and this is their legacy. Maybe the tea parties are a good idea after all. At least the participants are less likely to be screwing-up anything else while being so engaged.

[Pale Horse]

Bob doesn't like to listen to reason. Bob, could you, in detail. explain how Bush incurred deficits for no good reason.