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Greg

Your kidding are you not??

Good thing there are people such as Bruce Bartlett that are out there to destroy these myths and deceitful op-eds you love to post. Before you make the claim the Bartlett is some left leaning liberal, here is a brief bio on him.

Bruce Bartlett served for many years in prominent governmental positions including executive director of the Joint Economic Committee of Congress, Deputy Assistant Secretary for economic policy at the U.S. Treasury Department during the George H.W. Bush Administration, and as a senior policy analyst in the White House for Ronald Reagan.

Why the Economy Needs Spending, Not Tax Cuts
http://www.capitalgainsandgames.com/blog/bruce-bartlett/1200/why-economy-needs-spending-not-tax-cuts

This is common criticism among Republicans who have a vested interest in blaming everything bad that happens on the Democrats. The implication is that if voters weren't so stupid and had instead elected John McCain to be president then the budget would be balanced, the debt would have disappeared, and the economy would be booming. That is not true, and the numbers do not support this.

According to the Congressional Budget Office's January 2009 estimate for fiscal year 2009, outlays were projected to be $3,543 billion and revenues were projected to be $2,357 billion, leaving a deficit of $1,186 billion. Keep in mind that these estimates were made before Obama took office, based on existing law and policy, and did not take into account any actions that Obama might implement.

Therefore, unless one thinks that McCain would have somehow or other raised taxes and cut spending (with a Democratic Congress), rather than enacting a stimulus of his own, then a deficit of $1.2 trillion was baked in the cake the day Obama took office. Any suggestion that McCain would have brought in a lower deficit is simply fanciful.

Now let's fast forward to the end of fiscal year 2009, which ended on September 30. According to CBO, it ended with spending at $3,515 billion and revenues of $2,106 billion for a deficit of $1,409 billion.

To recap, the deficit came in $223 billion higher than projected, but spending was $28 billion and revenues were $251 billion less than expected. Thus we can conclude that more than 100 percent of the increase in the deficit since January is accounted for by lower revenues. Not one penny is due to higher spending.

It should be further noted that revenues are lower to a large extent because of tax cuts included in the February stimulus. According to the Joint Committee on Taxation, these tax cuts reduced revenues in FY2009 by $98 billion over what would otherwise have been the case. This is important because the Republican position has consistently been that tax cuts and only tax cuts are an appropriate response to the economic crisis.

According to the Council of Economic Advisers, as of August the actual budgetary effect of the February stimulus was to reduce revenues by $62.6 billion and raise spending by $88.8 billion. Of the spending, the vast bulk went to transfers such as extended unemployment benefits and aid to state and local governments, which may have prevented cuts in spending that would otherwise have occurred but probably didn't do anything to increase spending. Only $16.5 billion in stimulus funds went to investment outlays for things such as public works. This is a trivial amount of money in a $14 trillion economy.

As if we needed further evidence that transfers have virtually no stimulative effect, the Bureau of Labor Statistics just issued a report on the 2008 tax rebate showing that only 30 percent of the money was spent; the rest was saved, thus providing no stimulus to short-run growth.

I continue to believe that the Republican position is nonsensical. Final proof is that the previously cited CBO report shows total federal revenues coming in at 14.9 percent of the gross domestic product in FY2009. According to the Office of Management and Budget, one has to go back to 1950 to find a year when federal revenues were lower as a share of GDP. For reference, revenues averaged 18 percent of GDP during the Reagan administration and were never lower than 17.3 percent - 2.4 percent of GDP above where they are now.

I think there are grounds on which to criticize the Obama administration's anti-recession actions. But spending too much is not one of them. Indeed, based on this analysis, it is pretty obvious that spending - real spending on things like public works - has been grossly inadequate. The idea that Reagan-style tax cuts would have done anything is just nuts.

Peg

Greg, do you ever pay much attention to what I post? Or do you just go ballistic and post comments that ought to be on your own blog - as they have little relevance to the posts I make at my own blog.

This post was primarily about the health care bills. Yes, there are a few economists and experts who seem to think these monstrosities make fiscal sense. But - not too many.

Spending overall is another issue. I'm talking about the cost and implementation of health care bills currently in Congress.

Greg

Peg,

First of all I do not go ballistic over anything you post. I find these post more of a comedic relief from the serious post and blogging I do on Daily Kos and Open Left and other more wonkish sites. Most of these post are like a online version of one of Glenn Beck's tea parties. In general most of your post have already been discussed and debunked on those sites so pretty much come here for far less wonkish debate. I would love to find a right wing site that could actually debate the facts, yet most are more concerned with right wing talking points than actual facts or policy. Now for my post.

My post fully demonstrated why this notion that this administration is driving the Titanic is false when as I pointed out you examine the real numbers. You are entitled to your own opinion, but your not entitled to your own facts. The numbers show that this administration had nothing to do with the current deficit, and this talk about spending us into trouble or heading the Titanic is a false argument. Now if you can come up with numbers, and a reasonable analysis that contradicts Bruce Bartlett's numbers then go for it. But the numbers are right there, so no manner of spinning from Douglas Holtz-Eakin will suffice. Just a small note, Holtz-Eakin now suffers from a small health care insurance issue. How ironic.

Republican adviser faces health care's costly bite
Former McCain strategist is about to lose his health insurance
http://www.washingtonpost.com/wp-dyn/content/article/2009/11/01/AR2009110102121.html

Now the current health care bill that is going through Congress is deficit neutral. The CBO projects this bill would extend coverage to 31 million uninsured people while reducing the federal deficit by nearly $130 billion over 10 years. CBO is predicting that spending per Medicare beneficiary would decrease, as compared to the growth rate of the past two decades (from 8% growth rate to 6% growth rate). As a result, the federal government would be spending less on health care in the decades following the initial 10-year window, despite the expansion in coverage. Over the second 10 years, CBO projects even greater cost savings--up to $650 billion. So I must ask, how is reducing the deficit over the next 20 years relates to anything such as heading the Titanic into an ice berg?

CBO: Senate Bill Costs $849 Billion, Major Deficit Reducer
http://tpmdc.talkingpointsmemo.com/2009/11/cbo-senate-bill-costs-849-billion-major-deficit-reducer.php

So I must ask you, do you think the CBO is wrong? Do they have a history of being inaccurate? Better yet, what would you like to see done that would be better. Please come up with something more than tort reform or nationalized health insurance policies. The numbers have been run on both of those, and they do little in the area of cost reform, while leaving large loop holes for the insurance industry. Conservative David Frum summed the Republican side on this issue perfectly.

GOP Missing in Action on Health Reform

Sen. Ron Wyden has sold to the Democratic leadership an amendment that would enable more employees to cash out their employer-provided benefits and buy their own insurance policy on a health exchange.

This seems a great idea – and even more, a great idea for conservatives. Remember, it was conservative economists who established the case for the irrationality of the whole employer-provided benefits system. It’s been a crazy feature of this year’s debate that conservatives keep backing themselves into positions they did not believe two years ago and won’t believe two years from now. Now we are in the ludicrous position of opposing curbs on Medicare spending, opposing global budgeting for health systems, opposing studies of comparative effectiveness -and championing the employer-provided system that Milton Friedman regularly excoriated as the source of all trouble in the American health market.

Why is it left to a Democrat like Wyden to press for individual purchase within a prudently regulated health marketplace?

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