Who to Blame For the National Debt

  • Webster666

    Posts: 9217

    Jun 06, 2011 6:57 PM GMT
    by Lori Montgomery, Published: April 30

    The nation’s unnerving descent into debt began a decade ago with a choice, not a crisis.

    In January 2001, with the budget balanced and clear sailing ahead, the Congressional Budget Office forecast ever-larger annual surpluses indefinitely. The outlook was so rosy, the CBO said, that Washington would have enough money by the end of the decade to pay off everything it owed.

    Voices of caution were swept aside in the rush to take advantage of the apparent bounty. Political leaders chose to cut taxes, jack up spending and, for the first time in U.S. history, wage two wars solely with borrowed funds. “In the end, the floodgates opened,” said former senator Pete Domenici (R-N.M.), who chaired the Senate Budget Committee when the first tax-cut bill hit Capitol Hill in early 2001.

    Now, instead of tending a nest egg of more than $2 trillion, the federal government expects to owe more than $10 trillion to outside investors by the end of this year. The national debt is larger, as a percentage of the economy, than at any time in U.S. history except for the period shortly after World War II.

    Polls show that a large majority of Americans blame wasteful or unnecessary federal programs for the nation’s budget problems. But routine increases in defense and domestic spending account for only about 15 percent of the financial deterioration, according to a new analysis of CBO data.

    The biggest culprit, by far, has been an erosion of tax revenue triggered largely by two recessions and multiple rounds of tax cuts. Together, the economy and the tax bills enacted under former president George W. Bush, and to a lesser extent by President Obama, wiped out $6.3 trillion in anticipated revenue. That’s nearly half of the $12.7 trillion swing from projected surpluses to real debt. Federal tax collections now stand at their lowest level as a percentage of the economy in 60 years.

    Big-ticket spending initiated by the Bush administration accounts for 12 percent of the shift. The Iraq and Afghanistan wars have added $1.3 trillion in new borrowing. A new prescription drug benefit for Medicare recipients contributed another $272 billion. The Troubled Assets Relief Program bank bailout, which infuriated voters and led to the defeat of several legislators in 2010, added just $16 billion — and TARP may eventually cost nothing as financial institutions repay the Treasury.

    Obama’s 2009 economic stimulus, a favorite target of Republicans who blame Democrats for the mounting debt, has added $719 billion — 6 percent of the total shift, according to the new analysis of CBO data by the nonprofit Pew Fiscal Analysis Initiative. All told, Obama-era choices account for about $1.7 trillion in new debt, according to a separate Washington Post analysis of CBO data over the past decade. Bush-era policies, meanwhile, account for more than $7 trillion and are a major contributor to the trillion-dollar annual budget deficits that are dominating the political debate.

    As Congress prepares this week to launch a high-stakes battle over whether to raise the legal limit on borrowing, the analyses offer a clearer view of the drivers of the debt — and of the difficulty of re-balancing the budget without new tax revenue.
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    Jun 06, 2011 6:59 PM GMT
    Webster666 saidby Lori Montgomery, Published: April 30

    The nation’s unnerving descent into debt began a decade ago with a choice, not a crisis.

    In January 2001, with the budget balanced and clear sailing ahead, the Congressional Budget Office forecast ever-larger annual surpluses indefinitely. The outlook was so rosy, the CBO said, that Washington would have enough money by the end of the decade to pay off everything it owed.

    Voices of caution were swept aside in the rush to take advantage of the apparent bounty. Political leaders chose to cut taxes, jack up spending and, for the first time in U.S. history, wage two wars solely with borrowed funds. “In the end, the floodgates opened,” said former senator Pete Domenici (R-N.M.), who chaired the Senate Budget Committee when the first tax-cut bill hit Capitol Hill in early 2001.

    Now, instead of tending a nest egg of more than $2 trillion, the federal government expects to owe more than $10 trillion to outside investors by the end of this year. The national debt is larger, as a percentage of the economy, than at any time in U.S. history except for the period shortly after World War II.

    Polls show that a large majority of Americans blame wasteful or unnecessary federal programs for the nation’s budget problems. But routine increases in defense and domestic spending account for only about 15 percent of the financial deterioration, according to a new analysis of CBO data.

    The biggest culprit, by far, has been an erosion of tax revenue triggered largely by two recessions and multiple rounds of tax cuts. Together, the economy and the tax bills enacted under former president George W. Bush, and to a lesser extent by President Obama, wiped out $6.3 trillion in anticipated revenue. That’s nearly half of the $12.7 trillion swing from projected surpluses to real debt. Federal tax collections now stand at their lowest level as a percentage of the economy in 60 years.

    Big-ticket spending initiated by the Bush administration accounts for 12 percent of the shift. The Iraq and Afghanistan wars have added $1.3 trillion in new borrowing. A new prescription drug benefit for Medicare recipients contributed another $272 billion. The Troubled Assets Relief Program bank bailout, which infuriated voters and led to the defeat of several legislators in 2010, added just $16 billion — and TARP may eventually cost nothing as financial institutions repay the Treasury.

    Obama’s 2009 economic stimulus, a favorite target of Republicans who blame Democrats for the mounting debt, has added $719 billion — 6 percent of the total shift, according to the new analysis of CBO data by the nonprofit Pew Fiscal Analysis Initiative. All told, Obama-era choices account for about $1.7 trillion in new debt, according to a separate Washington Post analysis of CBO data over the past decade. Bush-era policies, meanwhile, account for more than $7 trillion and are a major contributor to the trillion-dollar annual budget deficits that are dominating the political debate.

    As Congress prepares this week to launch a high-stakes battle over whether to raise the legal limit on borrowing, the analyses offer a clearer view of the drivers of the debt — and of the difficulty of re-balancing the budget without new tax revenue.


    How 'bout a far far shorter list: who is NOT to blame?
  • rnch

    Posts: 11524

    Jun 06, 2011 7:18 PM GMT
    southbeach1500 saidPresident Obama and the Democrat controlled Congress chose to cut taxes, jack up spending and, for the first time in U.S. history, wage two wars solely with borrowed funds.

    Since then, President Obama has engaged the U.S. in a third war, paid for solely with borrowed funds.

    In addition, the Democrat-controlled Congress, along with President Obama, have added $4.3 trillion to the national debt, going from approximately $10 trillion to $14.3 trillion in a little more than 2 years.




    southbeach jane, y.i.b. :

    stop watching the feaux news channel!
  • Webster666

    Posts: 9217

    Jun 06, 2011 8:50 PM GMT
    southbeach1500 saidPresident Obama and the Democrat controlled Congress chose to cut taxes, jack up spending and, for the first time in U.S. history, wage two wars solely with borrowed funds.

    Since then, President Obama has engaged the U.S. in a third war, paid for solely with borrowed funds.

    In addition, the Democrat-controlled Congress, along with President Obama, have added $4.3 trillion to the national debt, going from approximately $10 trillion to $14.3 trillion in a little more than 2 years.





    You didn't read the OP.
    Fool.
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    Jun 06, 2011 9:04 PM GMT
    And yet the Repubs not only haven't learned from the repeated failure of their trickle down economics - they continue to support the same failed policies!

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    Jun 06, 2011 9:18 PM GMT
    southbeach1500 said
    Webster666 said
    southbeach1500 saidPresident Obama and the Democrat controlled Congress chose to cut taxes, jack up spending and, for the first time in U.S. history, wage two wars solely with borrowed funds.

    Since then, President Obama has engaged the U.S. in a third war, paid for solely with borrowed funds.

    In addition, the Democrat-controlled Congress, along with President Obama, have added $4.3 trillion to the national debt, going from approximately $10 trillion to $14.3 trillion in a little more than 2 years.





    You didn't read the OP.
    Fool.



    I did. I took my sentence directly from the piece and updated it.

    Original sentence:

    Political leaders chose to cut taxes, jack up spending and, for the first time in U.S. history, wage two wars solely with borrowed funds.

    My sentence:

    President Obama and the Democrat controlled Congress chose to cut taxes, jack up spending and, for the first time in U.S. history, wage two wars solely with borrowed funds.







    TOTAL BS.

    The newly elected Repubs refused to act on any piece of legislation until the Bush tax cuts for the rich were extended.
    It wasn't Obama's choice, it was his compromise.
    It was the newly elected Repub House's choice, and Obama only agreed to it in order to get a long list of other items that he wanted and that the Repubs opposed.
    That's how business in Washington gets done.
    Bipartisan compromise.

    Obama didn't choose to "jack up spending".
    He was forced to jack up spending in order to pull the country out of the severe Bush recession he inherited.

    And Obama didn't choose the two wars, he inherited them from Bush.

    Unintentionally, you just proved that it was Bush's fault!!!
    For once, you're right!!!
  • CuriousJockAZ

    Posts: 19119

    Jun 06, 2011 11:21 PM GMT
    I think at this point, when in doubt, just blame Anthony's Weiner icon_eek.gif
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    Jun 06, 2011 11:30 PM GMT
    CuriousJockAZ saidI think at this point, when in doubt, just blame Anthony's Weiner icon_eek.gif




    Or Schwarzenegger's cheating and impregnating weiner.

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    Jun 06, 2011 11:33 PM GMT
    southbeach1500 said



    rickrick91 saidObama didn't choose to "jack up spending".
    He was forced to jack up spending in order to pull the country out of the severe Bush recession he inherited.


    Ummmm.... all that spending hasn't been very effective has it. Of course, there was another choice. NOT to add $4.3 trillion to the national debt, weaken the dollar and go to war against business. That would have resulted in a strong economic rebound. But Democrats aren't capable of doing such things.








    You aren't very good with history nor economics.. its painfully evident.
  • Goofeyman

    Posts: 199

    Jun 07, 2011 12:40 AM GMT
    From 2009-current, it's oBAMA.....
  • Goofeyman

    Posts: 199

    Jun 07, 2011 12:41 AM GMT
    I need to add to that.

    Prior to 2009, it was our democratic congress.