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Bush’s Fault? Not so Fast, Steny! April 28, 2010

Posted by geoff in News.
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Steny Hoyer lays the deficit at Bush’s feet.

There’s a myth that our budget deficit mess sprang into existence at the presidential inauguration on Jan. 20, 2009. But in truth, more than 90% of the projected deficit we will face over the next decade is the result of President Bush’s 2001 and 2003 tax cuts, the wars in Afghanistan and Iraq, the rescue of the financial sector he began in the last few months of his presidency, and lower revenues from the recession.

Fortunately, we’ve heard that one before, and we debunked it over 2 months ago.

Hoyer should start reading a higher class of blogs.

Comments»

1. Nan G - April 28, 2010

OK, I followed your link and read the whole thing.
Right over my head!
I just don’t understand it…..but I WANT to be able to.
Could you pretend you’re explaining it to a child???
Sorry.
I’d love to be able to use it, but if I can’t explain it I dare not.

2. geoff - April 28, 2010

Hmmm. Well the tax cuts are easy: Bush’s tax cuts expire this year, so only the interest from those tax cuts should be added to the tally going forward. But the chick who did the analysis kept the tax cuts in, because Obama has been talking about extending them.

So the logic matrix goes like this:

Bush Tax Cuts: Bad & Irresponsible
Obama Extending Bush’s Tax Cuts: No Problem
Bush: Responsible for Lost Revenues Due to Tax Cuts + Interest from Incurred Deficit
Obama: Just Put it On Bush’s Tab

3. geoff - April 28, 2010

Now for the CBPP’s calculation approach:

If you try to extend the CBPP’s chart backwards to include 2008, you’ll find that the total for 2008 is much larger than the actual deficit for that year. Why?

The short answer is because the CBPP’s approach is stupid.

The longer answer is that: 1) there are other items that contribute to the deficit; and 2) many of the items listed are in the budget and thus paid for.

What the CBPP did was add up the 2009 expenses they felt were mostly Bush’s fault until they reached the deficit total for 2009. They picked the ones they hated most (TARP, tax cuts, the wars): note, for example, that they didn’t include NCLB or the Medicare pharmaceutical costs. So is the deficit more attributable to tax cuts or Medicare costs? Their choice was arbitrary and self-serving.

4. geoff - April 28, 2010

As far as the economic downturn:

1) the Stimulus package was wasteful, too slow, and thus largely ineffective – the downturn numbers should have been reduced, but they’re huge;

) Bush was faced with a similar downturn with the dot com crash, but took action to get the economy rolling – somehow the fact his tax cuts stemmed from downturn of his own has escaped the CBPP. They’re fine with letting Obama off the hook for the economic downturn during his administration, but the costs of Bush’s tax cuts are completely his fault, even though he was trading tax cuts for economic stimulus.

3) The Obama administration has been very hostile to business, which has prolonged and deepened the recession. The “economic downturn” is not an act of God – it’s a situation that can be improved or worsened based on economic policy. So claiming that Obama is blameless for the economic downturn costs is silly.

5. geoff - April 28, 2010

Finally: they didn’t include the costs of Obamacare and Cap-and-Trade, and other increased expenditures coming down the pike. Bush’s costs are fixed and known: Obama’s costs are only going to go up. And as we’ve seen, he has no issue with increasing spending that he can’t pay for. He had the choice to throttle back on spending or charge ahead. He made his choice, but the chart doesn’t show the consequences.

6. Nan G - April 28, 2010

Thanks for all of the clarification.
I wish we had a new chart more accurate to compare with the fradulent one.
But at least I get it now.

7. Mrs. Peel - April 28, 2010

Nan, if you’re still here, these charts at Hillbuzz are pretty helpful.

8. Nan G - April 29, 2010

Wow!
Those were helpful!
Thanks, Mrs. Peel.
(I watched the Avengers every day after school as a youth. He was so debonnaire! She was so hot!)

9. Nan G - April 30, 2010

Now, a new question:
The GDP grew for 3 consecutive quarters.
Is there any other reason for the media not declaring the recession over ….. other that, if they do….they cannot turn around and blame Bush if it double dips?
Most of the media is NOT calling the recession over.

10. Michael - April 30, 2010

Is there any other reason for the media not declaring the recession over . . .

Technically, it’s over with two consecutive quarters of GDP growth. Even if it double dips.

The problem is that the early phase of any recovery is jobless, because employers cash in on productivity gains and hedge their bets while they wait for demand to recover, and that’s Obama’s political problem. No net new jobs.

The MSM do not want to call attention to the fact that stuff like the Porkulus and Cash for Clunkers was pointless, ineffective, crowded out private investment, needlessly ran up the national debt. Plus, in the middle of a recession, Obama scared employers with the threat of new taxes for Obamacare, most likely a VAT to pay for it which is basically a regressive hidden sales tax that will suppress demand.

The result — no net new jobs.

So, they are giving the Dems free rein to indulge in some more pointless spending and run up the debt some more, so they can pretend they are doing something about unemployment. Also, they are indulging in some frivolous bashing of Wall Street to distract attention from the real issues.

(BTW, even I concede that unregulated trading in mortgage-backed derivatives with no reserve requirement was a bad idea, but not as bad as the Community Reinvestment Act that caused the problem in the first place.)

That’s just how the libs are wired. They assume that government spending and more regulation is the logical solution to every problem.

That’s why we have a huge government populated by employees who earn way more than their private sector counterparts. In a more just world, I reckon that about one-quarter of them should be unemployed, homeless, and sleeping under a bridge tonight. Fair compensation for the damage they have done.

11. Michael - April 30, 2010

I read once that there is a federal law which requires that the Department of Agriculture must have an office and at least one agent in every county in the U.S.

Never mind that the county might be the Mojave Desert, where there is no agriculture. Never mind that the county might be highly productive Wisconsin dairy farms, where nobody actually needs help from the federal government to run their farms.

I can’t figure out why the fuck the federal government is involved in agriculture at all. We don’t need those bureaucrats. They are just funding a bunch of subsidy programs that distort the markets.

How does shit like this happen? Why can’t we stop it?

12. Michael - April 30, 2010

I’m telling you, it would warm my heart to drive under a bridge and see the sleeping bags of homeless former DOA employees.

13. TXMarko - May 1, 2010

Michael, my sentiments exactly, regarding DOA employees.

My Father-In-Law was a Farmer with 240 acres of his own, and several hundred more cash-rented every year.

I drove him to the DOA office one year when we were visiting.

They had maps of all the areas he farmed, and they basically told him what he could plant and where.

He even had his own little 1/2 acre “wetland” that he was not allowed to do anything with.

Bastards.

14. nooneofanyimport - May 1, 2010

Thanks for commenting, Nan, b/c I also was getting a little lost and the additional comments have helped. So glad to have some good economic and mathatical brains on which to rely. I’m mostly just good for waxing poetic about broad principles. (I.e., not good for much.)

How do we stop it, indeed?

The question that’ll keep you up nights.

15. Michael - May 1, 2010

Hey, nooneofanyimport, I have some advice for you.

At IB (and in the eyes of God), you are important, whether you feel that way or not.

16. Michael - May 1, 2010

Michael, my sentiments exactly, regarding DOA employees.

Thanks, Mark. Glad somebody besides me has noticed this. It’s hard to be more useless than the Department of Education, or Health and Human Services, but DOA has actually managed to do so.

At the very bottom of the federal septic tank is Housing and Urban Development.

Don’t get me started.

17. Michael - May 1, 2010

Just to be fair, the federal government has many cabinet level departments which are useful, even despite their constant fuckups, to wit:

Defense

Treasury

Justice

Commerce

Labor

State

Interior

Overall, they are probably more useful than harmful.

We also have useful agencies. NASA is good for our souls. Agencies like the FDA and the FTC probably have a net beneficial effect on restraining the excesses of completely unregulated free-market capitalism, which is what caused them to be created in the first place. The CIA is a necessary evil in a cruel world. The EPA does some good because it basically deals with the problem of “dumping in the commons.” The FCC is still necessary to allocate wireless bandwidth.

On the other hand, Amtrak, the Corporation for Public Broadcasting, and the Post Office should all be sold to private enterprise, and be unregulated. They are all obsolete.

Probably the federal prison system should be privatized as well.

I have pondered whether the National Park Service should be sold to companies like Disney and Six Flags. I think not.

18. Michael - May 1, 2010

But, the National Park Service is really an interesting issue, in my opinion. It’s really two issues:

1. Should we sub-contract the maintenance and support of public lands to private companies, operating for profit and regularly bidding on the jobs, rather than relying on federal NPS employees?

Not an easy decision, if you think about it.

2. Should we sell the land so that Yosemite Valley, for example, or Kings Canyon, is owned and run by Disney or Six Flags as a theme park, where the owner has a major capital investment in maintaining the pristine beauty of the property, but marketing and exposing it to as many people as possible, as opposed to management by federal employees?

Also not an easy decision.

19. Mrs. Peel - May 1, 2010

Regarding the post office, I think the Constitution actually specifies that as one of the duties of the federal government. Is that right? If so, then an amendment would be required to privatize it, right?

While I wouldn’t object to privatizing the post office in principle, it’s easy for me to say that because I don’t live in a rural area where my nearest neighbor is 10 miles away. The post office HAS to deliver everywhere at the same price. A private organization would charge through the teeth to deliver to rural areas.

20. Michael - May 1, 2010

I come down on the side of the National Park Service.

My reasoning is this: I have really enjoyed many national parks. They are a great resource for all Americans.

So, I remember the advice given to me by a buddy of mine maybe 35 years ago, something that he learned in the Army — “If it ain’t broke, don’t fix it.”

21. Michael - May 1, 2010

A private organization would charge through the teeth to deliver to rural areas.

Yes, it would. But those rural people mostly are throwing away the hugely expensive junk mail deliveries they get (third class mail is still a P.O. monopoly), and they mostly rely on email. They can pay all their bills online to avoid the price of a stamp. When they order something online, it comes by FedEx or UPS.

I’m just sayin’, the Post Office used to have what economists refer to as a “network effect” that was beneficial to the economy as a whole.

That “network effect” is gone.

Also, when you are talking about those poor rural folks, you are talking about subsidizing Robert Redford’s fabulous home in Sundance. We subsidize Bob’s phone service at his hot tub as well. Plus a lot of farmers that are multimillionaires. Oh, let’s not forget all the gentrified millionaire owners of vineyards all over the damn place, starting with the Napa and Sonoma counties in California, but they are everywhere today.

22. Michael - May 1, 2010

My point being — if you are going to subsidize people, it should be means-tested. You should subsidize the poor.

Crude classifications like rural/urban, or old/young, or black/white, always lead to perverse results that defeat your purpose of providing a social safety net.

23. Michael - May 1, 2010

The “social safety net” has its own downside, by the way. Economists call it the “moral hazard” of insurance.

The basic idea is this — is you protect everyone from a common risk, like fire, you increase the hazard.

In other words, if everyone has fire insurance and an efficient fire department, there will be more fires.

Substitute “poverty” for “fire,” and you can get what Lyndon Johnson’s “War on Poverty” actually accomplished.

Yep. More poverty.

The upshot of Lyndon Johnson’s “Great Society” program was crime-riddled high-rise ghettos.

24. Mrs. Peel - May 1, 2010

I wasn’t suggesting that rural = poor. I was just thinking about the high prices, and pointing out that it’s easy for me to support a change that would benefit me (similarly, “sin taxes” don’t affect me because I don’t smoke or drink; so it’s easy for me to fall into the trap of merely shrugging my shoulders when those taxes are hiked). You are correct, though, that the price of a stamp is a subsidy and doesn’t necessarily help the poor.

I hate junk mail. Most of the mail I receive goes straight in the trash. Do companies really get a sufficient rate of return to justify sending it? Same question for telemarketing.

25. Michael - May 1, 2010

Do companies really get a sufficient rate of return to justify sending it?

Yes, because it is so so cheap. The response rate does not have to be very high to make it pay for high-margin products and services.

That’s why we need a spam filter for our email inbox. There are still Nigerians out there who can make money sending their stupid pitch to gullible Americans. There are still Russians offering penis-enlarging gadgets to gullible Americans.

26. TXMarko - May 1, 2010

Dept. of Energy = FAIL on SO many levels…….

27. Retired Geezer - May 1, 2010

There are still Russians offering penis-enlarging gadgets to gullible Americans.

You didn’t by chance, save that website address, did you?
A friend wants to know.

28. Michael - May 2, 2010

You didn’t by chance, save that website address, did you?
A friend wants to know.

That device does not really work. Plus, it is painful.

Also, they do not actually honor their money-back guarantee if you are not satisfied with their product.

Trust me about this.

29. daveintexas - May 2, 2010

Do they sell anything than can make it a little smaller?

30. Cathy - May 2, 2010

Do they sell anything than can make it a little smaller?

A Slurpee?

31. daveintexas - May 2, 2010

oh my.

32. pendejo grande - May 2, 2010

As to Mrs. Peel’s concern about USPS: I live a lot more rurally than about 98% of the US population. I mail off about 10 pieces of important stuff per month. I could pay bills online, but I have a phobia of letting people have electronic access to my bank acct. So I continue to do it the old fashioned way. Long story short – no more than I use the US mail system, the price could quintuple and it wouldn’t affect my standard of living much. Don’t get me wrong, it would piss me off, but I wouldn’t miss a meal. I don’t have to pay a cent for all the incoming. Which is epic due to my good credit rating. Rural businesses might suffer though.

33. Michael - May 3, 2010

I could pay bills online, but I have a phobia of letting people have electronic access to my bank acct. So I continue to do it the old fashioned way.

You are actually less secure by doing that, because you are giving human eyeballs access to your account information. That is dangerous.

You are more secure if you transact online, using secure 32-bit encrypted connections, where your deal is buried beneath a bazillion similar deals, and not a single human eyeball is involved. Trust me, I have done this. Maybe if you get up to $.5M, a human will intervene. Below $.5M, you won’t get noticed. The threshold used to be lower, but it has moved up.

[You also can get dinged by a human if you are on vacation, and using a credit card away from your home country, or even your home zip code. The credit card company’s security software will flag that down, and call you about it, if the charges are high enough. Their software is really pretty good about this, because legally, they are at risk if I am racking up lots of charges in Belize or New Mexico and they ignore this. So, Citibank talks to me and asks me about the name of my favorite pet. I tell them. Then I can get gas in my car.]

You can move hundreds of thousands of dollars between accounts, and no human being will notice, and it’s pretty safe if you keep your home system secure with the necessary hardware firewall, and a responsible anti-virus system (I use McCaffee, and pay for it), and a reliable anti-spyware system (I use Lavasoft, it’s free).

That is actually more secure than putting stuff in the mail and exposing your transaction to human eyeballs.

34. Lipstick - May 3, 2010

Mr. Lipstick on male movie viewing standards:

I don’t care about character development, I just want to see a three-titted alien get blown up!

Fin.

35. Michael - May 3, 2010

^

You know, I really want to meet Mr. Lipstick. I love that guy. We need to hug. No kidding, I want a hug from Mr. Lipstick.

But, we have to do it right. Show Mr. Lipstick the instructional video:

How To Give A Great Man To Man Hug.

So, I’m saying that I really want to meet Mr. BigStick, and hug him, assuming that he has been properly instructed.

36. kevl - May 3, 2010

Mr LS is teh hot. Big and mean looking.

37. lauraw - May 3, 2010

“If it ain’t broke, don’t fix it.”

In RE: the National Park Service, google ‘smoky madtom.’

38. skinbad - May 3, 2010

We had a very aggravating experience at a CA state park last year. My opinion after that was they could hardly do worse if they privatized. Yosemite (our first visit), though crazily busy, was a very good experience. So, props to the Feds on that.

39. Jake - May 4, 2010

Well if President Bush had answered his critics, i.e. fired back, instead of thinking he was taking the high road, then maybe we wouldn’t had this statest in the whitehouse now. Granted it would have been a 24/7 task since the left owned media attacked him 24/7 for 8 years minus a couple days at 9 11. Since he didn’t, the media successfully convinced 68 million that he was to blame for everything. So in some way, the anti liberty forces now destroying out nation is Bush’s fault. As for the ecomomy imploding – sub prime legislation signed in 1999.

40. Lipstick - May 4, 2010

Mr LS is teh hot. Big and mean looking.

Heh. Ironically, the photo kevl saw was our wedding photo.

🙂


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