where the deficit comes from

(from Sunday's NYT)

A couple of few thoughts:

1) Health care reform under Obama is just over 1/10th the cost of Bush's wars. Remind me when the Tea Party started?

2) The projections are probably too kind to Mr. Obama. He has 1.5 (or 5.5) more years to add new policies that aren't even on the graph yet.

3) That said, I really am less interested in which proportion of the deficit can be laid at which president's feet than I am in noting that the single largest contributor--the Bush tax cuts--seems to have been taken completely off the table. Personally, I dislike the mentality that categorizes tax cuts as "expenditures". But that's really beside the point...the deficit is not merely a spending problem, but a spending and revenue problem. More revenue has to be part of the solution.

4) If you add Bush's and Obama's stimulus spending together including the stimulus tax cuts under Obama (and I think you should, for the purpose of analyzing the effect of policy rather than scoring political points), that is the single biggest contributor to the deficit.


Gino said...

any graph that includes tax cuts as expenditures is already too idealogically polluted to be taken seriously.

yes, revenue needs to be part of the solution, of course. but tax cuts have been known to increase revenue at times as well.

i'm not saying whether this was the case for Bush's tax cuts, cause i dont know either way if it was.

Gino said...

just noticed the graph places TARP under bush.
wasnt there two TARPs, one under obama, or were they both bush's?

Brian said...

"tax cuts have been known to increase revenue at times as well."

Debatable. And complicated, that:


My (admittedly superficial) understanding is that if you cut rates enough to spur economic growth, you increase the tax base and potentially, therefore, net revenue. I'm agnostic on how often that actually happens, but I think it's safe to say it hasn't in the last 10 years (for any number of reasons.)

TARP was initiated under Bush. Other stimulus packages were initiated under Obama (and are on the graph.)

Brian said...

Just to be clear...I'd rather it be true that cutting taxes leads to increased revenue. That would be a lovely thing to know for sure. I'm just not really convinced that it does.

Gino said...

like i said: at times.

i think the reagan cuts increased collections, as did the JFK cuts.

pesronally, id rather the debate was more about 'what should govt be doing?' and then paying for it, then saying 'this shit costs too much' and opposing it.