Most agree that the last GOP debate was less foolishly personal and trivial, and more substantive. What kind of substance was it, though? They talked about the “disastrous” fiscal policies of the Obama administration, and how going on like that would ruin the country. Really?
Here is a chart that shows the deficit reduction by Obama:
It illustrates that the country had a $400 billion deficit in 2008 under Bush. Then the economy took a nosedive before Bush left office. Obama inherited a 1.4 trillion-dollar deficit and was also left with the task of bailing out the entire world economy. We did that by massive “stimulus” spending, which shows in the additional trillion dollar deficit in 2010 and 2011. Then, however, things started getting better, and in the subsequent years, Obama has been successful in reducing the deficit, year after year. The last president that accomplished that was Clinton, who produced a surplus in the last two years. That surplus, of course, stimulated Bush to go on a spending spree with massive tax cuts to the rich and to businesses. In the end, as the chart above shows, that didn’t help the country.
To be fair though, just reducing the deficit still increases the debt. Obama has added about $7 trillion to the national debt during his administration, overall. He’s just been adding less and less every year as the years went on. Unfortunately he won’t be in office long enough for this trend to continue and achieve a surplus.
The public thinks the Obama administration has increased the deficit. It has not. It has reduced it substantially. But it still has increased the debt.
Let’s look at debt instead:
Here we show how the public debt increased by percent of the GDP, by president. This shows that in relative terms, Bush and Obama are similar in their accumulation of new debt. Since Obama has another year in office, it will go up somewhat, but still not surpass Bush.
Those that make out Bush the hero of economic policy and Obama the villain need to deal with the reality that they are actually quite similar. The only difference is that when Obama leaves office next January, the economy won’t likely be in free fall, and the next president can continue to build on the deficit reduction and won’t need to start massive stimulus spending to keep the country moving.
What sticks out like the proverbial middle finger, however, is Reagan. The GOP debate candidates always like to point to Reagan as the fiscal policy genius that saved the world from communism, won the cold war, and through trickle-down economics saved the country’s economy. In reality, he added more debt to the nation than the three presidents before him combined, any other president since Nixon, by more than a factor of two.
Yet, when I listen to the GOP candidates, this is what they seem to want to go back to. That makes no sense to me.