Tag Archives: budget deficit

‘Welcome back,’ ballooning budget deficits

Ronald Reagan and his fellow Republicans made lots of hay in 1980 about the “spiraling” budget deficit during that presidential election year. It totaled a whopping $40 billion.

The GOP presidential nominee’s campaign ridiculed those big-spending Democrats en route to a smashing landslide election victory over President Jimmy Carter.

Ah, yes. Republicans were the party of “fiscal responsibility.”

Hah! Not any longer. The Congressional Budget Office projects that the current fiscal year will end with an $800 billion budget deficit and will surpass $1 trillion by the next fiscal year.

Hey, what happened? Oh, it’s that tax cut that the Republicans wrote into law — at the insistence of Donald J. Trump, and the $1.3 trillion spending bill approved by Congress.

What happened to fiscal restraint? Where are the controls on runaway government spending? Aren’t congressional Republicans — who control the House and the Senate — supposed to rein in free-spending tendencies usually associated with liberal Democrats?

A Democratic president, Bill Clinton, managed to craft a balanced budget in the late 1990s with help from congressional Republicans. Then came Republican George W. Bush, who succeeded Clinton in 2001. We went to war at the end of that year, but didn’t increase taxes to pay for it. The deficit soared out of control.

Democrat Barack Obama came aboard in 2009 with the economy in free fall. He pushed a tax hike and a spending boost through Congress. The economy recovered. The deficit was pared by roughly two-thirds annually by the time he left office in 2017.

Now we’re hurtling back to Square One. The deficit is exploding.

And no one in power seems to care about things that used to matter a lot.

Deficit hawks have taken a powder

You have heard it said — I am quite certain — that “we ought to run the government like we run a business.”

I ask: How many businesses do you know operate on deficits approaching the scale of what we’ve had in the federal government?

None. Right? Of course!

But now we have the Business Mogul in Chief as president of the United States and those federal budget deficits are approaching $1 trillion annually, a figure not seen since early in the Obama administration.

I should remind you that Barack Obama took office in January 2009 with the economy in free fall. He pushed through some ambitious rescue plans that included tax increases to help pay for the significant boost in public spending to help failing businesses.

The result over President Obama’s two terms was a serious reduction in the annual budget deficit; it shrank annually by about two-thirds.

It’s now heading back up. Congress keeps spending while approving big tax cuts. I believe that’s a recipe for increasing budget deficits, which in turn pile on more money onto the national debt that now stands at a cool $20 trillion.

Deficit mounts

Treasury Secretary Steve Mnuchin now wants Congress to boost the nation’s borrowing capacity to pay for all this spending.

Just wondering: Isn’t the Republican Party the party of fiscal responsibility? What’s more: How many businesses would survive such exorbitant spending?

Deficit hawks have turned chicken

What has happened to the deficit hawks who used to dominate the Republican Party?

They have become chicken hawks, or just plain chicken.

Congressional Republicans used to rant, rail and express rage over budget deficits. Ronald Reagan derived a lot political advantage in 1980 by ridiculing the $40 billion budget deficit run up annually during the Carter administration.

Fast-forward to the present day.

Republicans are going to enact a tax cut that will blow up the deficit. It will add $1 trillion — or so — to the deficit over the next decade. That’s $100 billion annually.

But here’s the ironic aspect of this deficit business.

A Democratic president, Bill Clinton, managed to craft a budget that produced a surplus by the end of his presidency. He had help from Republicans in Congress, but the point is that the president and the GOP congressional leadership managed to cooperate and work together for a common good.

Another Democrat, Barack Obama, also managed to take huge bites out of a trillion-dollar-plus annual budget deficit. By the time President Obama left office, the budget deficit had been slashed by about two-thirds annually.

There were tax increases along with targeted budget cuts.

Did the GOP members of Congress give the president any credit? Nope. Didn’t happen. They instead changed the subject by targeting the Affordable Care Act, concocting reports of “dismal failure.”

But here we are today. A new president has taken over. He has sought desperately to achieve some kind of legislative “victory.” Republicans in both congressional chambers are poised to give it to him.

At what cost? Oh, yes. The deficit is set to grow once again. The one-time Party of Fiscal Responsibility has changed it stripes.

RINOs take over congressional GOP

Republican Party “purists,” whoever they may be, must be furious with what the GOP majority in Congress has done.

Republicans who control both congressional chambers have just rammed through two versions of a tax cut that by many economists’ view is going to explode the federal budget deficit.

Therefore, congressional Republicans — virtually to a person — comprise Republicans In Name Only. They are the dreaded RINOs that purists keep condemning as closet big-spenders masquerading as members of the party of fiscal responsibility.

One Republican — lame-duck U.S. Sen. Bob Corker of Tennessee — managed to vote “no” on the Senate version of the tax cut. But he was the only one.

Now this monstrosity goes back to the House of Representatives, which will seek to reconcile its differences with the Senate version. Then they get to vote again on it.

After that? It goes to the Oval Office, where the president of the United States will sign it. He’ll boast about the “victory” he won. Donald Trump will take credit for enacting a bill about which he likely doesn’t know a thing.

Do you remember the time when Republicans used to blister Democrats for running up those huge deficits? As recently as the 2016 election, Republicans were pounding freely at Democratic President Barack Obama for overseeing a sharp growth in the national debt. But here’s the deal: Under the Obama presidency, the size of the annual deficit was decreasing almost every year; by the time President Obama left office, the annual budget deficit had been cut by about two-thirds from the amount he inherited when he took office in January 2009.

I guess those days are gone, along with any chance that Republicans and Democrats are going to find common ground on matters that affect all Americans.

As for the country’s budgetary future, it’s now in the hands of RINOs. When are the party purists going to start squawking?

Hello? Is there anyone out there?

Where have the deficit hawks gone?

I always have thought that congressional Republicans were deficit “hawks,” officials who hated federal budget deficits and certainly derided those spendthrift Democrats for piling up the national debt.

Why, then, are GOP senators so intent on pushing a tax cut bill that will explode the annual deficit and add hundreds of billions of dollars to the debt?

A new non-partisan analysis indicates that the GOP tax plan will spur some limited economic growth, but it’s going to add $1 trillion to the deficit.

Here is part of what CNN is reporting:

The Joint Committee on Taxation, the Congressional scorekeeper for tax bills, estimates that the Senate tax bill could generate enough growth to create nearly $408 billion in new revenue over a decade. But even with that additional revenue, the bill would still add an estimated $1 trillion to deficits.  

JCT’s macroeconomic analysis — also known as a dynamic score — falls far short of Treasury Secretary Steven Mnuchin oft-made claim that the tax cuts will pay for themselves.

There also doubts about whether the wealthiest Americans are going to pay more or less under the GOP-railroaded tax overhaul. Donald Trump keeps insisting it will “cost me a fortune … believe me.” Actually, I’ve discovered that whenever the president says “believe me” I need to discount the veracity of any point he is trying to make.

But if Republicans are so damn hawkish on budget deficits when Democratic presidents are seeking to boost the economy, shouldn’t they remain that way when their political brethren seek to do the same thing?

Senate GOP makes yet another run at the ACA

Here we go … again!

U.S. Senate Republicans have come up with a scheme to pay for the big tax cut they’re trying to enact that involves the Affordable Care Act. They want to repeal the individual mandate portion of the ACA, which they say will save more than $300 billion over the next decade.

The savings would be used to pay for the tax cuts being pitched for many wealthy Americans.

This is so very maddening, in my ever-so-humble view.

Congress trying again to repeal ACA

Congress has been unable to repeal the ACA and replace it. The president has been unable push his Republican pals across the finish line. They have tried and failed since long before Donald Trump took office as president of the United States.

Now comes this bit of Senate trickery: attach the individual mandate repeal to a tax cut they say would jumpstart the economy. Moreover, is anyone on Capitol Hill or the White House worried any longer about the national debt and our annual budget deficit, which economists say are going to explode under the GOP tax cut?

I want to make a couple of points.

One is that the economy is rocking along just fine. The U.S. Labor Department announced earlier this month that non-farm payrolls jumped by 260,000 jobs in October; the unemployment rate is at its lowest rate in 17 years. Not bad, man!

Two, enrollment for the ACA is moving along at a brisk pace. Hundreds of thousands more Americans signed up for insurance when open enrollment began at the beginning of the month, despite the president’s efforts to undermine the ACA.

I remain totally opposed to any wholesale repeal of the ACA. I continue to insist that it can be improved. It can be made more affordable. 

Removing the individual mandate — which requires Americans to purchase health insurance or face a penalty — is certain to do one thing: It will toss millions of Americans off the rolls of the insured.

How is that supposed to help?

Remember when deficits mattered to GOP?

Donald J. Trump’s tax “reform” plan appears to be a prescription for doing something that used to be anathema to Republicans.

It will blow apart the national budget deficit.

I recall a day when deficits actually mattered to Republicans. The GOP spent a lot of political energy and capital during the eight years of Barack Obama’s presidency to lambaste the president for expanding the national debt, even though the annual budget deficit was cut by two-thirds during Obama’s two terms.

Flashing back to 1980, I want to recall how Ronald Reagan managed to be elected president. He and his fellow Republicans tore congressional Democrats — and President Carter — to pieces because they were running deficits that exceeded $40 billion annually.

Forty billion dollars!

Don’t you wish that were the case today?

Well, deficits no longer seem to matter. Republicans have joined their Democratic colleagues as political spendthrifts. Trump is going to cut taxes for his fellow wealthy Americans; his administration calls it the greatest tax cut in history. The spending will go on. The deficits are likely to soar. Won’t that pile more money onto our national debt?

Where is the outrage over that?

‘Mess’? Mr. President, you inherited a ‘mess’?

Barack Hussein Obama doesn’t need me to defend him.

Aww, what the heck. I’ll do so anyway.

His successor as president of the United States told us Tuesday night once again that he inherited a “mess” when he took office a little more than a month ago.

Donald J. Trump’s assertion came during his speech to a joint session of Congress. He talked about 94 million Americans no longer looking for work and about how the economic recovery is the slowest in 60-plus years.

He blamed President Obama’s economic policies.

Ayyye!

I’ll stipulate up front that the economic recovery isn’t as robust as most of us would like.

But …

The economy isn’t a “mess,” as Trump said it is. You want a “mess”? Consider what Obama inherited when he took office in 2009: Employers were shucking jobs at 700,000 per month; the stock market plummeted, costing trillions of dollars in wealth; the auto industry was failing; banks were failing; the economy was heading straight into the crapper, man!

Eight years later, where do we stand? The Dow Jones Industrial Average virtually tripled in wealth; the jobless rate has been cut in half; we’ve had 80 consecutive months of job growth; the auto industry has been revived; bank closures have all but stopped.

Oh, the 94 million figure Trump cited about those who are no longer seeking employment? That number includes retirees and students. It’s a phony statistic.

The debt? Sure, it’s high. I wish it were less than it is, too. Why did we accrue such debt? Because the economic stimulus package Congress approved shortly after Obama took office required the infusion of public money to shore up an economy on the verge of total collapse.

I’ll add — for the umpteenth time — this point as well: The annual federal budget deficit has been cut by nearly two-thirds during the past eight years.

A mess, Mr. President? No, sir. You did not “inherit a mess.” Stop repeating that outright lie!

What? The U.S. economy is stronger than we thought

There goes — maybe — another argument that Donald J. Trump used so effectively to be elected president of the United States.

He griped for months that the U.S. economy was growing at an anemic pace. We had to do better and, by golly, he was going to bring jobs back; he is going to return those jobs that had fled to China and Mexico.

Then the U.S. Commerce Department shoots a hole in that argument. It said today the U.S. economy grew at a fairly robust 3.5 percent annual growth rate in the third quarter of 2016.

Hmmm. Interesting, if you ask me.

The Dow Jones Industrial Average has tripled in value during the Obama administration; joblessness has been cut in half; we’ve had 81 consecutive months of non-farm job growth; the annual federal budget deficit has been cut by two-thirds.

http://money.cnn.com/2016/12/22/news/economy/us-gdp-third-quarter-last-revision/index.html?iid=surge-stack-dom

OK, it won’t mean the entire year that’s about to pass into history has been pulled out of the economic ditch. The first half of 2016 produced pretty slim growth.

But the third quarter is demonstrating the distinct possibility that the economy is in better shape than Trump and his legions of doom had been saying.

Might the president-elect and his team been spouting just more campaign rhetoric?

Right-wrong track polls tell only part of story

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One of my social media friends thinks I spend too much time blogging about Donald J. Trump.

I heard him. So I think I’ll shift gears for a moment or two.

Those polls that measure whether Americans think we’re heading on the right or wrong track puzzle me. Take a look at the latest RealClearPolitics average of polls on that subject.

http://www.realclearpolitics.com/epolls/other/direction_of_country-902.html

What these averages don’t necessarily say up front is whether Americans want the nation’s directly to veer sharply to the right or sharply to the left.

I generally pay little attention to these polls.

The RCP average says there’s a 30-plus percentage variance, meaning that about one-third more Americans think the country is heading on the “wrong track.”

No one has ever polled me on the subject. If one were to ask me, I’d say we’re doing just fine. I heard the U.S. Labor Department jobs report this morning and learned we added 161,000 non-farm jobs in October; the jobless rate declined to 4.9 percent; wages went up.

Is that a wrong track indicator regarding the economy?

I don’t think so.

Foreign policy issues? Well, we haven’t been hit by a major terror attack since 9/11. We keep killing terrorists around the world. Our alliances seem solid.

Federal budget policy? The deficit has been cut by one-third during the past eight years. Is it still too great? Yes. It’s heading in the “right direction.”

I’m digressing.

Right track-wrong track polls tell only part of the story.