President Obama is now the $5 Trillion Man. $5 Trillion in deficit spending in just over 3 years. It took our nation from George Washington through Bill Clinton to hit our first $5 Trillion in debt. It took George W Bush 8 years to add just under $5 Trillion to our deficit. Pres Obama is the clear record holder. And if re-elected, his proposed budgets would have him deficit spending as much (or more) than all previous presidents combined.
So, just what can one buy with $5 Trillion?
- Pay off half of all mortgages in the United States
- Give 100 Million people $50,000 each
- Offer all small businesses that you will pay the salaries of 2 new workers each (total of 12 million new jobs) up to $50K each for the next 8 years.
- Buy 20 Million American made automobiles for $25K each
- Two years of all health expenditures in the United States
What other things can $5 Trillion buy?
You’re being intellectually dishonest unless you credit his predecessor for the huge deficit Obama inherited when he took office. A huge and unnecessary tax cut, an unfunded prescription drug plan, two unnecessary wars, TARP…you name it. When you’re handed a truckload of manure, it takes a while to get unload it.
Ray, you would have a point, but Obama supported TARP, increased the number of troops in Afghanistan, has done nothing about the prescription drug plan and is following the Bush plan in Iraq. He founded a deficit commission and did nothing about its results. Every budget he has proposed has had huge increases in spending. So, if Obama had done the following:
1)Pushed for an immediate withdrawal in Afghanistan.
2)Opposed TARP and the stimulus.
3)Proposed budgets with lower spending, including on prescription drugs.
4)Accelerated the pullout from Iraq.
If he had done these things, I might even vote for Obama. But unfortunately he did none of them, so, to use your example, he has turned a truckload of manure into five truckloads instead of getting rid of the one he was given.
Ray, I was being honest. I noted that Bush brought up the deficit by almost 5 Trillion in his 8 years.
I was also, as Geoff noted, honest about his own vast spending. Did anyone force Obama to push forth health care? Did we need to bail out the big banks? Did we need to loan $57 Billion to GM, convert $50B to stock so GM wouldn’t have to pay it back with interest, and then claim they are doing well on their own? Did we have to bail out Chrysler, giving its wealth to the union, rather than its stockholders?
Obama has brought out two budgets. Both received ZERO votes in Congress. Both would have INCREASED our deficit even more than the status quo we are in. He ignored his Simpson-Bowles commission to fix the economy. He has only increased deficit spending each year.
These $5 Trillion are HIS. And his projected budgets (that Congress voted down) would have increased the deficit by another $5 Trillion over the next 4 years. Guess what? He would then be the $10 Trillion man.
Of course, this all ignores the fact that Social Security and Medicare are now slated to go bankrupt within the next 2-3 years….
As candidate, Obama promised to reduce the annual debt in half. Instead, he’s more than doubled it. These are his to own, not GWBush.
Ramy,
You forgot to mention the continuation of the Bush tax cuts on Obama’s watch – as long as we’re talking about increasing the national debt.
Pointing out that Pres. Obama doesn’t have the will, integrity, or ability to change what he campaigned on or elected to change isn’t a very good defense of Pres. Obama.
He campaigned for “change” so he can’t say “Bush did this and I’m just continuing his budgets”.
He also can’t say, “Washington politicians screwed this up, and I don’t have the ability to change it” because first of all he was one of those Washington politicians who voted for a lot of things that add to the deficit, and second he was elected by promising “change”.
I think a lot of Presidents get into office and then realize how screwed the nation’s economy is and they hear from all the big economists that we just need to keep the shell game going longer than the rest of the world (somewhat true). But eventually it will all collapse…. and their best hope is that we collapse last because all the world’s capital will flight to the USA as the final safe haven. Well, I guess they are also hoping that somehow Europe and China will dramatically increase per capita consumption to the level of the USA. But that’s a fools hope that has been wished for, for decades as the solution to the USA’s deficit problems.
By design, the automatic stabilizers ensure that the deficit grows whenever the private sector economy slows, without the president or congress doing or not doing anything. Any discussion of the level of the deficit is meaningless unless placed in its proper context with regard to the states of the private and external sectors.
When social security goes “bankrupt” does the final check issued, the one for which there are insufficient funds, actually bounce? Find the answer to that question and you will see why the modern monetary system is nothing like your household finances.
The President, contrary to popular belief, is not a king. He doesn’t singlehandedly control the direction of the government, particularly with regard to how it spends tax revenues. That is Congress’ job. They control the pursestrings.
So why do the fingers always get pointed at the President? Sounds like someone’s using the fundamental skill that magicians exercise: misdirection.
The Bush tax cuts were scheduled to expire. Guess what? Pres Obama continued them by reauthorizing them into law! So, Bush may have been originally responsible for the tax cuts, but once reauthorized, it became Obama’s baby.
Remember, Obama started out with both houses of Congress controlled by the Democrats. He could have gotten lots done regarding the economy, immigration, etc. Instead, he chose to spend most of that time on health care. He squandered his opportunity.
Yes, the president is not a monolith. However, Pres Obama promised certain things. If we passed the stimulus, the unemployment would stay below 8 percent. Obamacare would save money (CBO now says it will cost almost $1 Trillion more than first thought). Bailouts would reinvigorate markets and small businesses. He put forth legislation that was supposed to save 4 million foreclosures (only 1/4 of that number may be saved). He “saved” 2 million jobs, but at a cost of almost $300K each!
The list goes on regarding his Keynesian failures. That GWBush was also embracing Keynes shows that his policies were also failing and drastically. Bush put us on a bus with no brakes. Obama has pressed on the accelerator, rather than trying to slow us down somehow.
Obama OWNS his $5 Trillion portion of the deficit. And 4 more years, if we believe the budgets he’s sent to Congress will raise his portion of the deficit to over $10 Trillion: More than all of the previous presidents combined.
So, perhaps I should have asked, what can you buy with $10 Trillion?
– all the mortgages in the USA
– all healthcare expenditures for 4 years
– the heart and soul of the American people
Rame, I agree that there should be no bigger priority for the US than trying to balance the budget and pay down the debt. And I agree that Obama has not done enough on that front. But what could he have done?
But I think that you should consider Obama’s intentions within their political and economic contexts.
TARP and the Bailout, although expensive, were designed prop up an economy headed for a serious depression. There are many economists who believe that without these measures, the economy would have collapsed and deficits would now be astronomical, well on the way to default and dramatic currency devaluation. So while TARP and the Bailout increased the deficit, most economists agree that deficits would possibly have even been much greater without them. Maybe this wouldn’t have happened. But a lot of smart people think it would have.
I also think you should consider Obama’s Health Care goals in their context. America ranks 22nd in quality of health care per capita, but pays 3 times as much as any of the other leading nations. It’s an absolute disaster, and here in the UK, people can’t understand the madness going on across the Atlantic. Obama’s original health care bill sought to include a public option, and other measures like the end of life counseling (death panels) that could have had a dramatic effect reducing the outrageous end-of-life expenses that choke our system. Public options could ration care, like other socialist countries and dramatically reduce costs.
Instead, we get a half-baked compromise, which probably will be more expensive. But there are solutions to be found where Obama was originally looking for inspiration: socialized medicine of other countries.
Obama also tried to end the Bush tax cuts. But he couldn’t. It would have been political suicide. He had virtually no mobility at that time, and still doesn’t. Congress is being held hostage by Grover Norquist pledgers.
Obama would like to raise taxes, which would help reduce the deficit. He can do this without hurting the economy according to the Law of Diminishing returns which dictates that according to a certain curve, capital in the form of tax returns has greater value than capital which is left in the economic system in the bank accounts of millionaires and billionaires. Current tax rates are well below that curve.
But Obama can’t raise taxes. He can’t remake the health care system into a cheaper European model. He can’t cut spending enough because of his own political alliances. He is actually quite powerless.
So I think we are headed for default. Obama just postponed it through the bailout and TARP. And someone like Mitt Romney is not going to save us either.
Nate,
TARP was not designed to prop up the economy. It was designed to pay off liberal contributors, such as the unions. As Rahm Emmanuel noted, “You never want a serious crisis to go to waste.”
Working on health care for over 1 year, rather than working on foreclosures, poverty, getting the debt down, etc., shows that Obama never really was interested in fixing the deficit. He was interested in expanding government involvement, in which he has succeeded. The Supreme Court cases regarding Constitutionality of several issues is a case in point on that one.
There are equally as many economists (who are not Keynesian economists) who believe that the Great Depression and the Great Recession have struggled along simply because government has created a bigger mess. History shows that past recessions and depressions have turned around within 3-4 years without government involvement. The Great Depression lasted over 10 years because of Hoover and FDR’s attempts to fix it. This one is lasting extra long, because Obama seeks to “fix it.” His “fix” includes major actions like having the super rich pay their “fair share”. In reality, that works for socialist schemes of fairness, but nothing for growing an economy, nor encouraging investment in our nation’s business.
Pres Obama knows what he’s doing. He seeks a nation that is dependent upon him and federal government. We now have record numbers on food stamps. That isn’t a coincidence, but rather a by-product of Obama’s “fixes.” As it is, I think he would make a great worker for the Humane Society or PETA, because he’s really good at “fixes” that leave the recipient impotent.
American health care needs to be fixed. But Obamacare is not a fix. It didn’t fix Medicare, but stole $500 billion from that plan to fund other health care programs. It didn’t resolve the issue of non-competition that occurs due to insurance monopolies. Hidden within it are all kinds of regulations and gotchas that will only increase the cost of health care. Obama’s goal was not a rebuilt from scratch modern program that fixes major problems, but an archaic and complex system that would require ever more government intervention. BTW, the IRS just received $500M in diverted cash, so they can implement their part of Obamacare. Seems like we don’t have enough police force there to enforce the penalties and regulations involved in it. Thus, bigger government to satisfy the federal monster’s appetite.
Obama is insisting that old people should maintain their level of coverage, while the deficits climb exponentially. Medicare costs are 1/4 of the current rising debt, and will increase as it rushes towards bankruptcy within 10 years. Instead of teaching old people to think of their grandkids, and cutting back on some expensive procedures (as they do in the UK, Canada, and elsewhere that health care is rationed). So, nothing was fixed. We only received bigger debt and bigger government.
If we could find a way to adopt a UK or Canadian health care system, it would definitely be better than what we have now. Still, I believe the best solution is a free market system, where competition drives down prices. I’d like to see a voucher system, where all are covered for basic health care, with those interested able to pay more for Cadillac coverage. Rather than buying a new hip for 85 year olds, we should give them a wheel chair. We can’t afford spending millions of dollars on operations for old people anymore, as this causes shortages elsewhere – such as health care for poor children.
Of course, Pres Obama isn’t dealing with such issues. He’s building a big socialist government, after all.
Rame, your opinion that government involvement prolonged the Great Depression is one that is held by some partisan economists, but certainly not held by President Obama and a majority of others. His intention was not to create and prolong a Great Depression where the country would be at his knees and he could expand government to his dream size. How can one believe such conspiracies? “Never let a crisis go to waste” was meant to help influence regulation so that this kind of collapse would never happen again. Further regulations of the banking and mortgage industry were seen as an absolute necessity by politicians on both sides.
This idea that Obama wants America “dependent on him” is also outrageous. Record numbers of food stamps is not evidence of this. It’s just evidence that the economy is in terrible shape and there is exploding poverty.
You say our current recession is lasting extra long because Obama is trying to “fix” things like making the rich pay more taxes. I thought earlier in your comments you admitted that Obama actually made a mistake in prolonging the Bush Tax Cuts, which should have been used to help reduce the deficit. So which is it? Should Obama have lowered taxes even more? Would that have magically fixed everything?
It’s true that Obama is ideologically a socialist, as I am. In a perfect world, both Obama and I would like to see a broader, more effective safety net, universal health care, and greater government investment. But you have to admit that Obama is also a pragmatist and willing to compromise, as he has on every single front, most especially health care, which is simply an amalgamation of former Republican Health Care ideas fro the 90s, and particularly on the extension of the Bush Tax Cuts.
So we have a president with a socialist ideology, who is willing to compromise, and Republicans are squandering that opportunity. Think how many spending cuts Obama might be willing to negotiate on if Republicans agreed to even the most marginal of tax increases on the rich. But the true ideologues the Republicans, not Obama. Obama is trying to run the country from the middle, and the Republicans are stuck on the fringe.
In a perfect world, Ron Paul would be our king for a year, and the budget would be balanced in an instant. Even I, as a socialist would be cool with that. This is exactly what we need when we have a ballooning deficit and a looming default. I’m not blind to these realities.
But this is a democracy and that will never happen. Republicans who are holding out for such a pie-in-the-sky dream will be sadly disappointed. There is only one way forward, and that is to recognize the pragmatists among us, and together come up with compromised budgets filled with targeted spending cuts and tax increases. Even then, I doubt it will work, but it is the only solution that even has the remote possibility of working.
I do not have to admit that Obama is a pragmatist. He has not compromised. His budget proposals are a perfect example of his disinterest in fixing the economy and deficit, as even the Democrats in Congress have voted them down, with zero votes for his budgets.
America has prospered, not because of socialist concepts, but because of freedom and liberty. That much of Europe also struggles due to an over-extension of socialist policies and over-spending is very clear.
I agree that the Bush tax cuts were a stupid thing in a time when we have such huge deficits. However, Pres Obama reauthorized the Bush tax cuts. That he is trying to collect $4 billion from the wealthy is a drop in the bucket (less than one day of deficit spending) is just a political move. He has not offered anything real. Instead of proposing both tax increases and decrease spending, his budgets only included increased spending. As with Paul Krugman, he thinks we can forever kick the can down the road.
His attempt toward growing government is very apparent. He told Joe Plumber that he wanted to redistribute the wealth. He has fought true reform of health care, instead giving us a giant government program that the CBO just stated would cost about $1 Trillion more than he originally claimed. His refusal to expand oil production, oil pipelines, refineries, or nuclear power show that he’s more interested in satisfying his patrons rather than provide jobs for the people.
That he has not given a real effort towards immigration also is evidence that he has not kept his promises.
What do you call “reauthorization of the Bush Tax Cuts” if not a compromise? What do you call the measly “$4 billion from the wealthy” if not an invitation to compromise on spending cuts? Surely Obama would want to increase that exponentially if he could. It is a political move! He is playing political tug of war, and the Republicans don’t want to play along. What harm does it do to Republicans and the economy to take $4 billion from the hands of the wealthy if it can be used as a pawn in future negotiations to cut spending? That is how government works.
Nate, we’ll just have to agree to disagree. This post is going way off from where the OP was. So, let’s close this one down for comments unless someone has something new and interesting to say.
For an intelligent person to believe that big/bigger gov. is the solution to our problems, is more than someone with a little brain (like me) can understand.
I just read Senator Tom Coburn’s new book called, “The Debt Bomb” wherein he gives plenty of evidence, as to how big gov. is not the solution to our problems, but is the root of the problem. Well, that and politicians that, for political reasons, will not do anything that might not help them get reelected. Things like cutting spending. Both parties are equally bad.
What does this topic have to do with Mormonism? Just wondering, since I thought the point of this blog was to discuss Mormon-related topics.
Sorry, I did not mean to stop the conversation.
I was just sincerely wondering. I am new to the bloggernacle and have found that most topics relate on Mormonism in one way or another. But this seems a bit tangential, unless it’s somehow related to an argument of why someone should vote for Romney, who is a Mormon.
Steve, we discuss a lot of things that are tangentially related to the Church, and sometimes they are not related at all. The author also has a weekly Sunday School lesson, so perhaps he just want to discuss something else. Keep on tuning in — we will have plenty of church-related topics in the weeks ahead.