Obama spending binge never happened

[SlyPokerDog]

WASHINGTON (MarketWatch) — Of all the falsehoods told about President Barack Obama, the biggest whopper is the one about his reckless spending spree.

As would-be president Mitt Romney tells it: “I will lead us out of this debt and spending inferno.”

Almost everyone believes that Obama has presided over a massive increase in federal spending, an “inferno” of spending that threatens our jobs, our businesses and our children’s future. Even Democrats seem to think it’s true.

But it didn’t happen. Although there was a big stimulus bill under Obama, federal spending is rising at the slowest pace since Dwight Eisenhower brought the Korean War to an end in the 1950s.

Even hapless Herbert Hoover managed to increase spending more than Obama has.

Here are the facts, according to the official government statistics:

• In the 2009 fiscal year — the last of George W. Bush’s presidency — federal spending rose by 17.9% from $2.98 trillion to $3.52 trillion. Check the official numbers at the Office of Management and Budget.

• In fiscal 2010 — the first budget under Obama — spending fell 1.8% to $3.46 trillion.

• In fiscal 2011, spending rose 4.3% to $3.60 trillion.

• In fiscal 2012, spending is set to rise 0.7% to $3.63 trillion, according to the Congressional Budget Office’s estimate of the budget that was agreed to last August.

• Finally in fiscal 2013 — the final budget of Obama’s term — spending is scheduled to fall 1.3% to $3.58 trillion. Read the CBO’s latest budget outlook.

Over Obama’s four budget years, federal spending is on track to rise from $3.52 trillion to $3.58 trillion, an annualized increase of just 0.4%.

There has been no huge increase in spending under the current president, despite what you hear.

Why do people think Obama has spent like a drunken sailor? It’s in part because of a fundamental misunderstanding of the federal budget.

What people forget (or never knew) is that the first year of every presidential term starts with a budget approved by the previous administration and Congress. The president only begins to shape the budget in his second year. It takes time to develop a budget and steer it through Congress — especially in these days of congressional gridlock.

The 2009 fiscal year, which Republicans count as part of Obama’s legacy, began four months before Obama moved into the White House. The major spending decisions in the 2009 fiscal year were made by George W. Bush and the previous Congress.

Like a relief pitcher who comes into the game with the bases loaded, Obama came in with a budget in place that called for spending to increase by hundreds of billions of dollars in response to the worst economic and financial calamity in generations.

By no means did Obama try to reverse that spending. Indeed, his budget proposals called for even more spending in subsequent years. But the Congress (mostly Republicans but many Democrats, too) stopped him. If Obama had been a king who could impose his will, perhaps what the Republicans are saying about an Obama spending binge would be accurate.

Yet the actual record doesn’t show a reckless increase in spending. Far from it.

Before Obama had even lifted a finger, the CBO was already projecting that the federal deficit would rise to $1.2 trillion in fiscal 2009. The government actually spent less money in 2009 than it was projected to, but the deficit expanded to $1.4 trillion because revenue from taxes fell much further than expected, due to the weak economy and the emergency tax cuts that were part of the stimulus bill.

The projected deficit for the 2010-13 period has grown from an expected $1.7 trillion in January 2009 to $4.4 trillion today. Lower-than-forecast revenue accounts for 73% of the $2.7 trillion increase in the expected deficit. That’s assuming that the Bush and Obama tax cuts are repealed completely.

When Obama took the oath of office, the $789 billion bank bailout had already been approved. Federal spending on unemployment benefits, food stamps and Medicare was already surging to meet the dire unemployment crisis that was well underway.

Obama is not responsible for that increase, though he is responsible (along with the Congress) for about $140 billion in extra spending in the 2009 fiscal year from the stimulus bill, from the expansion of the children’s health-care program and from other appropriations bills passed in the spring of 2009.

If we attribute that $140 billion in stimulus to Obama and not to Bush, we find that spending under Obama grew by about $200 billion over four years, amounting to a 1.4% annualized increase.

After adjusting for inflation, spending under Obama is falling at a 1.4% annual pace — the first decline in real spending since the early 1970s, when Richard Nixon was retreating from the quagmire in Vietnam.

In per capita terms, real spending will drop by nearly 5% from $11,450 per person in 2009 to $10,900 in 2013 (measured in 2009 dollars).

By the way, real government spending rose 12.3% a year in Hoover’s four years. Now there was a guy who knew how to attack a depression by spending government money!

Rex Nutting is a columnist and MarketWatch's international commentary editor, based in Washington.

http://www.marketwatch.com/story/obama-spending-binge-never-happened-2012-05-22?pagenumber=1

 

[Denny Crane]

Talk about rewriting history. Bush submitted a $3.1T budget, and Obama took office and threw it out in favor of his own $3.6T one.


http://www.washingtonpost.com/wp-dyn/content/article/2008/02/04/AR2008020400493.html

President Bush yesterday unveiled a $3.1 trillion budget plan for fiscal 2009 that will leave deficits of more than $400 billion this year and next, forcing his successor to grapple with a range of unpalatable choices to close the gap, according to lawmakers and budget experts.

http://www.reuters.com/article/2009/02/26/us-obama-budget-idUSTRE51O6JA20090226

An eye-popping $1.75 trillion deficit for the 2009 fiscal year underlined the heavy blow the deep recession has dealt to the country's finances as Obama unveiled his first budget. That is the highest ever in dollar terms, and amounts to a 12.3 percent share of the economy -- the largest since 1945. In 2010, the deficit would dip to a still-huge $1.17 trillion, Obama predicted.

 

[Denny Crane]

Here's how it went down:

http://www.powerlineblog.com/archives/2012/05/barack-obama-fiscal-conservative.php

It started with the ridiculous column by one Rex Nutting that I dismantled last night. Nutting claims that the “Obama spending binge never happened.” He says Obama has presided over the slowest growth in federal spending in modern history. Nutting achieves this counter-intuitive feat by simply omitting the first year of the Obama administration, FY 2009, when federal spending jumped $535 billion, a massive increase that has been sustained and built upon in the succeeding years. Nutting blithely attributes this FY 2009 spending to President Bush, even though 1) Obama was president for more than two-thirds of FY 2009; 2) the Democratic Congress never submitted a budget to President Bush for FY 2009, instead waiting until after Obama was inaugurated; 3) Obama signed the FY 2009 budget in March of that year; 4) Obama and the Democratic Congress spent more than $400 billion more in FY 2009 than Bush had requested in his budget proposal, which was submitted in early 2008; and 5) the stimulus bill, which ballooned FY 2009 spending, was, as we all know, enacted by the Democratic Congress and signed into law by President Obama. So for Nutting to use FY 2010 as the first year of the Obama administration for fiscal purposes was absurd. Moreover, it was largely because of the incredible explosion in federal spending in the first year of the Obama administration that the Tea Party movement sprang up, the GOP swept the 2010 elections, and federal spending has been relatively stable (although not declining, of course) since then.

 

[jlprk]

• In the 2009 fiscal year — the last of George W. Bush’s presidency — federal spending rose by 17.9% from $2.98 trillion to $3.52 trillion. Check the official numbers at the Office of Management and Budget.

• In fiscal 2010 — the first budget under Obama — spending fell 1.8% to $3.46 trillion.

• In fiscal 2011, spending rose 4.3% to $3.60 trillion.

• In fiscal 2012, spending is set to rise 0.7% to $3.63 trillion, according to the Congressional Budget Office’s estimate of the budget that was agreed to last August.

• Finally in fiscal 2013 — the final budget of Obama’s term — spending is scheduled to fall 1.3% to $3.58 trillion. Read the CBO’s latest budget outlook.

Okay Denny, that was only 2009. Where's your response to the other years?

 

[PapaG]

Barry is claiming to be a fiscal conservative now?

HAHAHAHAHA!

He's done.

 

[Denny Crane]

Okay Denny, that was only 2009. Where's your response to the other years?

$trillion+ deficits

 

[jlprk]

Okay, so Denny admits that while the article is true, he disputes that the first budget year should count as Republican-inspired. So the Bloomberg service can go ahead and run the whole article, except the part about the first year, and put Denny's name at the top as the author.

 

[jlprk]

All I see are Federal departments making painful cuts under Obama's direction, including my favorite, NASA. Obama courageously included Defense in the cuts, and now Republicans are reneging on their budget compromises, since they got liberal programs cut, and sneaking restoration of Defense cuts into unrelated legislation.

 

[Denny Crane]

The first three things Obama did in office:
1) Asked for the 2nd half of the $700B TARP money so he could spend it (on GM, among other things)
2) Asked for and got the democrats to pass a $800B "emergency" stimulus bill
3) Increased the budget from $3.1T to $3.6T.

A year later, he spent an additional $1.6T a year on health care. The credit card bills for that one haven't hit us yet.

Meanwhile, the Fed printed over $2T in new money and spent that on Obama's behalf. This shows up on the Fed's balance sheet, not in the govt. expenditures. Awesome slight of hand. Only fools are fooled by it, though.

Redact all that and you get jlprk's version of history.

But nah, he didn't spend like a drunken sailor! And that's an insult to drunken sailors, since they stop spending when their wallets are empty.

To give him credit for not continuing to increase govt. spending even further than (far beyond) our means is laughable.

 

[jlprk]

You're still talking about the first year.

I almost wish he'll lose, so a Republican president can take blame for continuing to do everything you just listed. All of it will have to be repeated until the country dies or rich conservatives pay enough taxes (it will be the former).

By the way, I don't read other sports boards because I like your liberal board. Anything goes, and threads swing way off-topic. Here's a thread I was reading a few minutes ago in which a robotic moderator reclassifies posts to the "correct" thread, post #651. You and I have this common interest.

http://forum.nasaspaceflight.com/index.php?topic=28970.msg905368#msg905368

 

[Denny Crane]

You seem to understand math.

It wasn't all in the first year. Bush left him a deficit of $400B, and the deficits are now $1.3T and upward.

If you insist on adding 1/2 TARP (which was spent before Bush left office), it'd be a $750B deficit. And there's a HUGE difference between a one-time TARP expense adding to the deficit one year and the habitual and perpetual $1T per year higher spending directly attributable to Obama.

End of story.

 

[PapaG]

The first three things Obama did in office:
1) Asked for the 2nd half of the $700B TARP money so he could spend it (on GM, among other things)
2) Asked for and got the democrats to pass a $800B "emergency" stimulus bill
3) Increased the budget from $3.1T to $3.6T.

A year later, he spent an additional $1.6T a year on health care. The credit card bills for that one haven't hit us yet.

Meanwhile, the Fed printed over $2T in new money and spent that on Obama's behalf. This shows up on the Fed's balance sheet, not in the govt. expenditures. Awesome slight of hand. Only fools are fooled by it, though.

Redact all that and you get jlprk's version of history.

But nah, he didn't spend like a drunken sailor! And that's an insult to drunken sailors, since they stop spending when their wallets are empty.

To give him credit for not continuing to increase govt. spending even further than (far beyond) our means is laughable.

All of that spending is credited TO BUSH in the Marketwatch article. It's a disingenuous and blatant lie designed to fool stupid people, and it looks like it's working.

~$1.5 trillion in spending, signed and authorized BY OBAMA, is "credited" to Bush because it occurred in FY 2009. Add in that spending that is 100% on Obama's shoulders, and this lie is exposed.

 

[PapaG]

You seem to understand math.

It wasn't all in the first year. Bush left him a deficit of $400B, and the deficits are now $1.3T and upward.

If you insist on adding 1/2 TARP (which was spent before Bush left office), it'd be a $750B deficit. And there's a HUGE difference between a one-time TARP expense adding to the deficit one year and the habitual and perpetual $1T per year higher spending directly attributable to Obama.

End of story.

The entire point of the Marketwatch article was to include FY 2009 as the baseline, and measure "Obama's" fiscal spending compared to "Bush's" (which includes the $867 billion Stimulus bill (partisan), ~$200 billion in TARP (Obama asked Bush to release that amount of the remaining amount so Obama could use it upon taking office), and a $410 billion spending bill that Bush didn't sign before leaving office (Dem House/Dem Senate), yet Obama did sign almost immediately after taking office.

Of all of the political lies I've seen, this one is the biggest whopper in quite some time. That Obama actually references it now in his stump speech says more about the audience than it does Barry, who is clearly a pathological liar to begin with, anyhow.

 

[PapaG]

Okay, so Denny admits that while the article is true, he disputes that the first budget year should count as Republican-inspired. So the Bloomberg service can go ahead and run the whole article, except the part about the first year, and put Denny's name at the top as the author.

Bush didn't sign an FY 2009 budget, Bush didn't sign the $867 billion Stimulus in FY 2009, Bush didn't sign the $410 billion additional spending bill in FY 2009, and Bush didn't release ~$200 billion in TARP funds in the spring of 2009.

So, other than that, it's Bush's fault. To not include the extra $1.5 TRILLION in Obama spending is hilarious, though. Dumb people believe dumb articles, and this one takes the cake.

 

[jlprk]

I guess you're right. Blame the deficit on Obama, not Bush. Obama caused the Republican crooks at Goldman Sachs to lie about derivative hedges. Obama made the loans to millions of unqualified mortgagees, not Republican bank owners. Obama started two simultaneous eternal wars to avenge his father's place in history. Obama doubled the cost of the secret government during the Bush years.

 

[PapaG]

I guess you're right. Blame the deficit on Obama, not Bush. Obama caused the Republican crooks at Goldman Sachs to lie about derivative hedges. Obama made the loans to millions of unqualified mortgagees, not Republican bank owners. Obama started two simultaneous eternal wars to avenge his father's place in history. Obama doubled the cost of the secret government during the Bush years.

In other words, you looked the fool, so now you go on one of your typical rants.

I was wondering whatever happened to LILCHOLO on ESPN. Any word?

 

[MARIS61]

You seem to understand math.

It wasn't all in the first year. Bush left him a deficit of $400B, and the deficits are now $1.3T and upward.

If you insist on adding 1/2 TARP (which was spent before Bush left office), it'd be a $750B deficit. And there's a HUGE difference between a one-time TARP expense adding to the deficit one year and the habitual and perpetual $1T per year higher spending directly attributable to Obama.

End of story.

You keep talking about deficits as if they are the same as current spending, which they are not.

Deficits are theeventual result of previous over-spending.

 

[Denny Crane]

You keep talking about deficits as if they are the same as current spending, which they are not.

Deficits are theeventual result of previous over-spending.

Absolutely wrong. Deficits are the current result of current over-spending.

 

[mobes23]

Absolutely wrong. Deficits are the current result of current over-spending.

I don't quite follow that -- tax receipts have obviously been down a lot so that deficits are quite large. When the economy is booming, it can hide bad spending habits because it could make the budget deficit lower.

Near as I can tell, people are most focused on government spending and whether it makes sense. While the budget deficits are admittedly scary, I don't get why the talk slips from the budget, which is a pretty accurate measure of spending, to the budget deficit, which includes spending, but also includes many other factors involving tax receipts (health of the economy, changes in tax rates, etc.)

In other words, if you're talking about government spending, then I think it makes sense to focus on the federal budget. Focusing on the budget deficit raises issues beyond spending and it's a different conversation that involves a lot more factors.

Edit: for what it's worth, I saw that article and I was interested in how Denny would respond. The biggest x factor seems to be how health care will be impacted and it'll be interesting to see how that plays out.

 

[MARIS61]

Absolutely wrong. Deficits are the current result of current over-spending.

You obviously don't understand how the government functions.

It's a slow plodding machine that takes years to set in motion or change direction. Very few Presidents/Congresses have ever had an immediate effect financially, and their successors nearly always get the blame or credit for their actions.

Even in ideal situations where both parties are in agreement it can take several years to pass a bill and fully implement it, then it takes years for the ultimate effects to become apparent.

But you already know that and take that position when it suits your arguement.

 

[Denny Crane]

I don't quite follow that -- tax receipts have obviously been down a lot so that deficits are quite large. When the economy is booming, it can hide bad spending habits because it could make the budget deficit lower.

Near as I can tell, people are most focused on government spending and whether it makes sense. While the budget deficits are admittedly scary, I don't get why the talk slips from the budget, which is a pretty accurate measure of spending, to the budget deficit, which includes spending, but also includes many other factors involving tax receipts (health of the economy, changes in tax rates, etc.)

In other words, if you're talking about government spending, then I think it makes sense to focus on the federal budget. Focusing on the budget deficit raises issues beyond spending and it's a different conversation that involves a lot more factors.

Edit: for what it's worth, I saw that article and I was interested in how Denny would respond. The biggest x factor seems to be how health care will be impacted and it'll be interesting to see how that plays out.

What happens when you increase spending by $500B and govt. receipts go down by $500B?

The budget is what it is. Sure, we spent $X, but we could afford $X - $Y (where $Y is a REALLY big number). You cannot just look at the budget, though. What if Obama increased spending to $10T, then spent $10T for the next 3 years? HUUUUUUGE deficits (my answer). "But he kept spending flat for 3 years" (Maris knows how the government functions!). The latter is the absurd argument (at $3.6T with revenues sub $2.3T). Seriously, if deficits don't matter, then the $10T spending figure isn't absurd, right? It's so absurd Democrats wouldn't even vote for Obama's proposed spending increases for his whole term.

As far as tax receipts go, there hasn't been a single proposal by Obama and Democrats to address the deficits. A proposed tax hike on the rich would raise $60B in income, compared to $1.7T type deficits. The $4T over 10 years spending cuts talked about by Obama (talk is cheap, it never showed up in his budgets) PLUS the tax hike would make a $460B dent in the $1.7T type figures. We'd still be running very close to $1T deficits.

As far as spending goes, the govt. printed well over $2T in money and spent it. Didn't have to tax anyone an additional $.01. And not $.01 of that $2T+ shows up as expenses on the budget.

 

[Denny Crane]

You obviously don't understand how the government functions.

It's a slow plodding machine that takes years to set in motion or change direction. Very few Presidents/Congresses have ever had an immediate effect financially, and their successors nearly always get the blame or credit for their actions.

Even in ideal situations where both parties are in agreement it can take several years to pass a bill and fully implement it, then it takes years for the ultimate effects to become apparent.

But you already know that and take that position when it suits your arguement.

LOL

It's easier than you think.

Obama proposes spending $3T or less. Congress passes it. They spend $3T or less.

It took the Democrats in congress days or maybe weeks to write and pass the "emergency" stimulus bill, the largest spending bill in the history of the planet.

 

[mobes23]

What happens when you increase spending by $500B and govt. receipts go down by $500B?

The budget is what it is. Sure, we spent $X, but we could afford $X - $Y (where $Y is a REALLY big number). You cannot just look at the budget, though. What if Obama increased spending to $10T, then spent $10T for the next 3 years? HUUUUUUGE deficits (my answer). "But he kept spending flat for 3 years" (Maris knows how the government functions!). The latter is the absurd argument (at $3.6T with revenues sub $2.3T). Seriously, if deficits don't matter, then the $10T spending figure isn't absurd, right? It's so absurd Democrats wouldn't even vote for Obama's proposed spending increases for his whole term.

As far as tax receipts go, there hasn't been a single proposal by Obama and Democrats to address the deficits. A proposed tax hike on the rich would raise $60B in income, compared to $1.7T type deficits. The $4T over 10 years spending cuts talked about by Obama (talk is cheap, it never showed up in his budgets) PLUS the tax hike would make a $460B dent in the $1.7T type figures. We'd still be running very close to $1T deficits.

As far as spending goes, the govt. printed well over $2T in money and spent it. Didn't have to tax anyone an additional $.01. And not $.01 of that $2T+ shows up as expenses on the budget.

All right, let's approach it another way. Do you actually think it's reasonable to expect small budget deficits when tax revenues are historically low because of a historically bad economy? The budget does not turn on a dime and can't scale up/down to match the economy. Shoot, even without tarp or stimulus spending, costs related to unemployment are sure to be a bigger expenditure. If you want to be mad about something, it's reasonable to be mad about tarp, stimulus, extended unemployment. Being mad about the portion of the deficit related to lost tax revenue/crappy economy is actually kind of ridiculous.

There has been talk of increasing tax revenue has but do you really think it would have had any chance of passing? From the perspective of picking battles, that would have been a sure loser and a waste of time given the current state of the economy. Which leads me to the next thought...

The time to get fired up about the deficit is when the economy is booming AND you're still running sizeable budget deficits. You can't get a clearer indicator that things are off course than when you're in that situation. You actually CAN have meaningful conversations about tax revenue AND spending. All the drama queen grandstanding about the deficit (speaking generally to tea party here and NOT calling you a drama queen, Mr. Crane) is a load of b.s. if there wasn't an equal amount of talk about it before the economy collapsed. Lol -- I think Denny actually did squak about it some back then, so he can sqwack a little now. But maybe not of ton because I don't think even he talked about it as much then as now.

 

[PapaG]

You obviously don't understand how the government functions.

It's a slow plodding machine that takes years to set in motion or change direction. Very few Presidents/Congresses have ever had an immediate effect financially, and their successors nearly always get the blame or credit for their actions.

Even in ideal situations where both parties are in agreement it can take several years to pass a bill and fully implement it, then it takes years for the ultimate effects to become apparent.

But you already know that and take that position when it suits your arguement.

Annual deficit

FY tax revenue and FY spending - the net on either side give you an annual surplus, or an annual deficit. We're running yearly deficits ~$1 trillion right now, which in turn feeds into the larger national debt.

LOL

 

[PapaG]

All right, let's approach it another way. Do you actually think it's reasonable to expect small budget deficits when tax revenues are historically low because of a historically bad economy? The budget does not turn on a dime and can't scale up/down to match the economy. Shoot, even without tarp or stimulus spending, costs related to unemployment are sure to be a bigger expenditure. If you want to be mad about something, it's reasonable to be mad about tarp, stimulus, extended unemployment. Being mad about the portion of the deficit related to lost tax revenue/crappy economy is actually kind of ridiculous.

There has been talk of increasing tax revenue has but do you really think it would have had any chance of passing? From the perspective of picking battles, that would have been a sure loser and a waste of time given the current state of the economy. Which leads me to the next thought...

The time to get fired up about the deficit is when the economy is booming AND you're still running sizeable budget deficits. You can't get a clearer indicator that things are off course than when you're in that situation. You actually CAN have meaningful conversations about tax revenue AND spending. All the drama queen grandstanding about the deficit (speaking generally to tea party here and NOT calling you a drama queen, Mr. Crane) is a load of b.s. if there wasn't an equal amount of talk about it before the economy collapsed. Lol -- I think Denny actually did squak about it some back then, so he can sqwack a little now. But maybe not of ton because I don't think even he talked about it as much then as now.

Record spending with a poor economy (and the associated low tax revenue) isn't worth getting "fired up" about? Now I've heard it all.

 

[Denny Crane]

All right, let's approach it another way. Do you actually think it's reasonable to expect small budget deficits when tax revenues are historically low because of a historically bad economy? The budget does not turn on a dime and can't scale up/down to match the economy. Shoot, even without tarp or stimulus spending, costs related to unemployment are sure to be a bigger expenditure. If you want to be mad about something, it's reasonable to be mad about tarp, stimulus, extended unemployment. Being mad about the portion of the deficit related to lost tax revenue/crappy economy is actually kind of ridiculous.

There has been talk of increasing tax revenue has but do you really think it would have had any chance of passing? From the perspective of picking battles, that would have been a sure loser and a waste of time given the current state of the economy. Which leads me to the next thought...

The time to get fired up about the deficit is when the economy is booming AND you're still running sizeable budget deficits. You can't get a clearer indicator that things are off course than when you're in that situation. You actually CAN have meaningful conversations about tax revenue AND spending. All the drama queen grandstanding about the deficit (speaking generally to tea party here and NOT calling you a drama queen, Mr. Crane) is a load of b.s. if there wasn't an equal amount of talk about it before the economy collapsed. Lol -- I think Denny actually did squak about it some back then, so he can sqwack a little now. But maybe not of ton because I don't think even he talked about it as much then as now.

I've never really been a deficit hawk. It's reasonable to run a deficit under certain circumstances.

For example, the govt. runs a balanced budget (like most states do). In order to build a bridge, they issue bonds. They now have spent at a deficit for the years it takes to build the bridge. They're paying back the loan over years, and finally pay it off. No more debt. Borrowing to build a bridge is a capital expense. Borrowing to fund operations is foolish - it's the equivalent of making $1K/month and spending $100 additional on your credit card so you can have a 10% better standard of living.

Using your talking points... They knew there'd be decreased revenues and still upped the budget. Now it's one thing to do a one-time TARP kind of thing and have a one year deficit of $1T+. That doesn't make it a structural thing. Obama and Democrats made it a structural thing, and projects $trillion deficits forever. They could have spent TARP and held the budget at $3T and saved us $2.5T in debt; they had full control of the two houses of congress and the presidency. The choice not to do so is the choice to spend that much more than we take in.

I wouldn't have done TARP, though, or at least I would have paid down peoples' mortgages so there'd have been a floor in the housing market prices and the banks get the same $$$ in the end.

Speaking of spending... If the govt. budget is $3.6T and they cut $500B in payroll taxes, is that not equivalent to spending that $500B?

As far as Tea Party is concerned, I'm with them on the smaller government and more constitutional government. If they go beyond those agenda items, they lose me.

 

[Denny Crane]

AP Fact Check article.

http://news.yahoo.com/fact-check-ob...-231221900.html;_ylt=A2KJ3CbkUcBPaDsADQ7QtDMD


FACT CHECK: Obama off on thrifty spending claim


WASHINGTON (AP) — The White House is aggressively pushing the idea that, contrary to widespread belief, President Barack Obama is tightfisted with taxpayer dollars. To back it up, the administration cites a media report that claims federal spending is rising at the slowest pace since the Eisenhower years.

"Federal spending since I took office has risen at the slowest pace of any president in almost 60 years," Obama said at a campaign rally Thursday in Des Moines, Iowa.

The problem with that rosy claim is that the Wall Street bailout is part of the calculation. The bailout ballooned the 2009 budget just before Obama took office, making Obama's 2010 results look smaller in comparison. And as almost $150 billion of the bailout was paid back during Obama's watch, the analysis counted them as government spending cuts.

It also assumes Obama had less of a role setting the budget for 2009 than he really did.

Obama rests his claim on an analysis by MarketWatch, a financial information and news service owned by Dow Jones & Co. The analysis simply looks at the year-to-year topline spending number for the government but doesn't account for distortions baked into the figures by the Wall Street bailout and government takeover of the mortgage lending giants Fannie Mae and Freddie Mac.

The MarketWatch study finds spending growth of only 1.4 percent over 2010-2013, or annual increases averaging 0.4 percent over that period. Those are stunningly low figures considering that Obama rammed through Congress an $831 billion stimulus measure in early 2009 and presided over significant increases in annual spending by domestic agencies at the same time the cost of benefit programs like Social Security, Medicare and the Medicaid were ticking steadily higher.

A fairer calculation would give Obama much of the responsibility for an almost 10 percent budget boost in 2009, then a 13 percent increase over 2010-2013, or average annual growth of spending of just more than 3 percent over that period.

So, how does the administration arrive at its claim?

First, there's the Troubled Assets Relief Program, the official name for the Wall Street bailout. First, companies got a net $151 billion from TARP in 2009, making 2010 spending look smaller. Then, because banks and Wall Street firms repaid a net $110 billion in TARP funds in 2010, Obama is claiming credit for cutting spending by that much.

The combination of TARP lending in one year and much of that money being paid back in the next makes Obama's spending record for 2010 look $261 billion thriftier than it really was. Only by that measure does Obama "cut" spending by 1.8 percent in 2010 as the analysis claims.

The federal takeover of Fannie Mae and Freddie Mac also makes Obama's record on spending look better than it was. The government spent $96 billion on the Fannie-Freddie takeovers in 2009 but only $40 billion on them in 2010. By the administration's reckoning, the $56 billion difference was a spending cut by Obama.

Taken together, TARP and the takeover of Fannie and Freddie combine to give Obama an undeserved $317 billion swing in the 2010 figures and the resulting 1.8 percent cut from 2009. A fairer reading is an almost 8 percent increase.

Those two bailouts account for $72 billion more in cuts in 2011. Obama supported the bailouts.
There's also the question of how to treat the 2009 fiscal year, which actually began Oct. 1, 2008, almost four months before Obama took office. Typically, the remaining eight months get counted as part of the prior president's spending since the incoming president usually doesn't change it much until the following October. The MarketWatch analysis assigned 2009 to former President George W. Bush, though it gave Obama responsibility that year for a $140 million chunk of the 2009 stimulus bill.

But Obama's role in 2009 spending was much bigger than that. For starters, he signed nine spending bills funding every Cabinet agency except Defense, Veterans Affairs and Homeland Security. While the numbers don't jibe exactly, Obama bears the chief responsibility for an 11 percent, $59 billion increase in non-defense spending in 2009. Then there's a 9 percent, $109 billion increase in combined defense and non-defense appropriated outlays in 2010, a year for which Obama is wholly responsible.

As other critics have noted, including former Congressional Budget Office Director Douglas Holtz-Eakin, the MarketWatch analysis also incorporates CBO's annual baseline as its estimate for fiscal years 2012 and 2013. That gives Obama credit for three events unlikely to occur:

—$65 billion in 2013 from automatic, across-the-board spending cuts slated to take effect next January.

—Cuts in Medicare payments to physicians.

—The expiration of refundable tax cuts that are "scored" as spending in federal ledgers.

Lawmakers are unlikely to allow the automatic cuts to take full effect, but it's at best a guessing game as to what will really happen in 2013. A better measure is Obama's request for 2013.

"You can only make him look good by ignoring the early years and adopting the hope and not the reality of the years in his budget," said Holtz-Eakin, a GOP economist and president of the American Action Forum, a free market think tank.

So how does Obama measure up?

If one assumes that TARP and the takeover of Fannie and Freddie by the government as one-time budgetary anomalies and remove them from calculations — an approach taken by Holtz-Eakin — you get the following picture:

—A 9.7 percent increase in 2009, much of which is attributable to Obama.

—A 7.8 percent increase in 2010, followed by slower spending growth over 2011-13. Much of the slower growth reflects the influence of Republicans retaking control of the House and their budget and debt deal last summer with Obama. All told, government spending now appears to be growing at an annual rate of roughly 3 percent over the 2010-2013 period, rather than the 0.4 percent claimed by Obama and the MarketWatch analysis.

 

[Denny Crane]

 

[maxiep]

You know on whom I blame this deficit? The voters that keep electing politicians who extend our credit.

The math is unavoidable. We need to stop spending more than we collect. The promises we made about when you can retire, how much you need to pay for your health care, etc. need to be redefined.

The party is over. It's time to start paying.