I'm as angry as the next guy about deficit spending by the GOP (especially under George W. Bush, when it really skyrocketed), but the 82 percent figure is misleading by not considering the following:
1) Whose debt is being considered? The original post at Swash Zone is from April 2009 and only includes figures through the end of the Bush Administration. It doesn't consider the enormous debt that the Obama Administration has incurred in just its first year in office.
2) When and how was the debt incurred? Most of the debt incurred during the Reagan and first Bush Administrations went towards building up the military, which ultimately led to the downfall of the Soviet Union. This in turn led to the "peace dividend" which allowed the Clinton Administration to bring down the debt.
3) What percentage of the Gross Domestic Product did each deficit comprise? This is important, because just as a rich man can comfortably carry more debt than a poor man, a country with a booming economy can incur new debt more safely than a a country in a recession. The deficits of the Reagan years were a smaller percentage of the GDP than are the deficits of the Obama years.
Which brings us to the other 82 percent.
Last March, in the first independent analysis of Obama's budget proposal (see this Washington Post article), the Congressional Budget Office reported that Obama's policies would result in "an ever-expanding national debt that would exceed 82 percent of the overall economy by 2019 -- double last year's [2008]level -- and threaten the nation's financial stability." [Emphasis added]
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Found at the excellent blog called What Would Jack Do?
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ReplyDeleteI'm as angry as the next guy about deficit spending by the GOP (especially under George W. Bush, when it really skyrocketed), but the 82 percent figure is misleading by not considering the following:
ReplyDelete1) Whose debt is being considered? The original post at Swash Zone is from April 2009 and only includes figures through the end of the Bush Administration. It doesn't consider the enormous debt that the Obama Administration has incurred in just its first year in office.
2) When and how was the debt incurred? Most of the debt incurred during the Reagan and first Bush Administrations went towards building up the military, which ultimately led to the downfall of the Soviet Union. This in turn led to the "peace dividend" which allowed the Clinton Administration to bring down the debt.
3) What percentage of the Gross Domestic Product did each deficit comprise? This is important, because just as a rich man can comfortably carry more debt than a poor man, a country with a booming economy can incur new debt more safely than a a country in a recession. The deficits of the Reagan years were a smaller percentage of the GDP than are the deficits of the Obama years.
Which brings us to the other 82 percent.
Last March, in the first independent analysis of Obama's budget proposal (see this Washington Post article), the Congressional Budget Office reported that Obama's policies would result in "an ever-expanding national debt that would exceed 82 percent of the overall economy by 2019 -- double last year's [2008]level -- and threaten the nation's financial stability." [Emphasis added]
That's the 82 percent we should be worried about.