June 21, 2009

So it went

"The story of today’s deficits starts in January 2001, as President Bill Clinton was leaving office. The Congressional Budget Office estimated then that the government would run an average annual surplus of more than $800 billion a year from 2009 to 2012. Today, the government is expected to run a $1.2 trillion annual deficit in those years.


You can think of that roughly $2 trillion swing as coming from four broad categories: the business cycle, President George W. Bush’s policies, policies from the Bush years that are scheduled to expire but that Mr. Obama has chosen to extend, and new policies proposed by Mr. Obama.


The first category — the business cycle — accounts for 37 percent of the $2 trillion swing. It’s a reflection of the fact that both the 2001 recession and the current one reduced tax revenue, required more spending on safety-net programs and changed economists’ assumptions about how much in taxes the government would collect in future years.


About 33 percent of the swing stems from new legislation signed by Mr. Bush. That legislation, like his tax cuts and the Medicare prescription drug benefit, not only continue to cost the government but have also increased interest payments on the national debt.


Mr. Obama’s main contribution to the deficit is his extension of several Bush policies, like the Iraq war and tax cuts for households making less than $250,000. Such policies — together with the Wall Street bailout, which was signed by Mr. Bush and supported by Mr. Obama — account for 20 percent of the swing.


About 7 percent comes from the stimulus bill that Mr. Obama signed in February. And only 3 percent comes from Mr. Obama’s agenda on health care, education, energy and other areas."

The pain of the US deficit will continue to sting us all for at least the next decade, on top of the prick of our own deficits.

God bless America, by all means, but by god they've botched their economy all the way to hell in a hand basket.

America's sea of red ink was years in the making

6 comments:

  1. From 'It's the economy, stupid!' to 'It's the stupid economy!'

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  2. It might be a dumb-arsed economy Timmy, but it's our dumb-arsed economy, so we'll keep luvin' it anyway.

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  3. I can only shake my head at the whole abomination.

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  4. Shake, shake, shake, shake, shake, shake ...

    Shouldn't there be recessions songs, or somethin', to lift our shrinking spirits?

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  5. I'll have a gin and tonic.. or three, Caz.
    That'll certainly lift my spirits. ;)

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  6. *clink of glasses*

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