Obama’s Real Debt and Deficit Legacy
By Stephen Moore
19 Feb 2018
Congressional Republicans have been raked over the coals in the last two weeks for slamming through budget caps and inflating government spending and debt by another $300 billion. The criticisms are well-deserved. It’s a historical truism that Republicans are much more fiscally conscientious when they are in the minority than when they run Congress. And Republicans tend to be much bigger fiscal hawks when there is a Democratic president than a Republican president — as we are now witnessing.
The only time in half a century that the budget has been balanced was in the late 1990s, when Bill Clinton was president and the Republicans ran Congress. It was a good combination. We ran four straight budget surpluses from 1998 to 2001, and government spending dropped gloriously, from about 20 percent of GDP to 17.6 percent. No wonder the economy boomed in those years. Government was less of a drag.
But now we are experiencing a historical revisionism — based on fantasy, not fact — about the fiscal record during the slow-growth Obama years. Amazingly, Barack Obama is being heralded as a deficit slayer who helped get our fiscal house in order. What’s next? Richard Nixon was really a pussycat?
Obama and his supporters are saying that he “cut the deficit by two-thirds” while president. The left-wing group Politifact, which is supposed to be a fact-checker, even has rated Obama’s claim as “mostly true.” Last week, while I was talking about the fiscal outlook on CNN, the producers put a chart on the screen showing that the deficit dropped by 60 percent while Obama was president.
My jaw dropped — literally — when I saw the chart. This takes data torturing to new heights. The national debt skyrocketed from $11 trillion to nearly $20 trillion on Obama’s watch. Is a diet successful if you start by weighing 200 pounds and eight years later you weigh 400 pounds? Would anyone in that position say, “I may be obese now, but at least I’m putting on the pounds at a slower pace”?
The national debt nearly doubled in eight years, which makes Obama the runaway Olympic gold medalist for fiscal incompetence. On this score Obama’s record is by far the worst of any modern president.
So where does this fantasy come from that Obama lowered the deficit by 60 percent?
Here are the official deficit amounts (in billions of dollars) in George W. Bush’s last year in office and Obama’s eight years in office:
2008 — 459
2009 — 1,413
2010 — 1,294
2011 — 1,300
2012 — 1,087
2013 — 680
2014 — 485
2015 — 438
2016 — 585
Here is some simple math for the Obama worshippers: $585 billion, the deficit at the end of the Obama presidency, is higher than $459 billion, the deficit at the beginning of the Obama presidency.
The left comes up with a different answer by dishonestly starting Obama’s deficit meter in 2010, after he passed the fiscal stimulus bill, an $800 billion debt bomb. So they assigned the gargantuan deficit in Obama’s first year to Bush. It is true that we were four months into fiscal year 2009 when Obama was sworn into office. And it is true that the deficit was going to be much higher no matter what Obama did in his first year because of the deep recession that ended in June 2009. So in fairness, some of the large deficit in 2009 was Bush’s fault.
But Obama made the deficit hundreds of billions of dollars worse with a stimulus plan that by the administration’s own admission didn’t create a single new job. The number of jobs in 2009, 2010 and 2011 was lower than Obama’s economists predicted we would get if we had done nothing and not wasted $800 billion.
Obama’s failed presidency is being falsely lionized in other ways, as well. The new spin from the left is that Obama saved the U.S. from a second Great Depression, when in fact he gave America the weakest recovery from a recession since the Great Depression. He also left Donald Trump with an economy that was crawling at 1.6 percent — which is why many people thought we were headed into another recession.
No one thinks that today. If the latest Federal Reserve Bank of Atlanta projections are right, we will have growth of 3.2 percent in the first quarter of this year, and we will have averaged 3 percent for the past year. This is almost twice the growth rate Trump inherited, and that number, ladies and gentlemen, is not fantasy; it is fact.