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#668 Musings Beyond the Bunker (Wednesday May 24)
THE BUDGET DEFICIT—WHAT ARE WE FIGHTING FOR?
What’s with the budget deficit? Why are we fighting over increasing the debt ceiling? Let’s be clear that raising the budget ceiling originally was a pro forma procedure but now is an opportunity for political grandstanding and demands for reductions in spending that are outside of the regular appropriations process.
Everything Kevin McCarthy and the Republicans are asking to reduce already has been approved by Congresses through a rigorous, rough-and-tumble process. Most of the expenditures in the budget have been approved during Republican and Democratic administrations alike. But the Republicans have seized upon the debt ceiling discussion as a “do over” to reduce the size of the social safety net and reduce spending, primarily as it affects the poor and the middle class. There is no question we need to rein in the expansion of the budget deficit. But that would involve both expenditures and revenues. The Republicans are uninterested in reducing some of the tax giveaways to the wealthy, like the “like kind” exchange, the step up in basis upon death, the reduced tax rate on capital gains, and treating hedge fund participation as capital gains, rather than as ordinary income. It’s farcical.
THE SIZE OF THE BUDGET DEFICIT
David Lash shared an article from the Boston Globe, highlighting the increases and decreases in the budget deficit over the last 60 years.
“The national debt is the accumulation of all of the budget deficits that administrations and Congress have run up over the years, minus what we have paid off. The best way to reduce the national debt is to reduce the budget deficit each year.
And yet ... every single Republican president has increased the budget deficit. Republicans have added far, far more to the national debt...
Funny thing, numbers.
Here's a look at the budget deficit each president since Lyndon Baines Johnson inherited from his predecessor, and what the budget deficit was when he left office.
Lyndon Baines Johnson (D)
Assumed office November 1963: $5 billion deficit
Left office January 1969: $3 billion surplus
Reduced the deficit by $8 billion
Richard Nixon (R)
Assumed office January 1969: $3 billion surplus
Left office August 1974: $6 billion deficit
Increased the deficit by $9 billion
Gerald Ford (R)
Assumed office August 1974: $6 billion deficit
Left office January 1977: $54 billion deficit
Increased the deficit by $48 billion
Jimmy Carter (D)
Assumed office January 1977: $54 billion deficit
Left office January 1981: $79 billion deficit
Increased the deficit by $25 billion
Ronald Reagan (R)
Assumed office January 1981: $79 billion deficit
Left office January 1989: $153 billion deficit
Increased the deficit by $74 billion
George H.W Bush (R)
Assumed office January 1989: $153 billion deficit
Left office January 1993: $255 billion deficit
Increased the deficit by $102 billion
Bill Clinton (D)
Assumed office January 1993: $255 billion deficit
Left office January 2001: $128 billion surplus
Reduced the deficit by $383 billion
George W. Bush (R)
Assumed office January 2001: $128 billion surplus
Left office January 2009: $1.4 trillion deficit
Increased the deficit by $1.5 trillion
Barack Obama (D)
Assumed office January 2009: $1.4 trillion deficit
Left office January 2017: $665 billion deficit
Reduced the deficit by $735 billion
Donald Trump (R)
Assumed office January 2017: $665 billion deficit
Left office January 2020: $3.7 trillion deficit
Increased the deficit by $3 trillion
Joe Biden (D)
Assumed office January 2021: $3.7 trillion deficit
Fiscal year 2022: $2.775 trillion deficit
Fiscal year 2023: $1.376 trillion deficit
Reduced the deficit by $2.3 trillion (so far)
…All six Republican presidents had larger deficits in their last budgets than they were handed at the start of their term.”
I’m not sure the information about President Biden is correct; after all, we are in the midst of quite a spending spree, with massive spending in the COVID response and lower tax revenues, as a result of reductions during the Trump years. What this data does confirm is that profligate spending knows no party. They both can be blamed. Work needs to be done on both fronts—expenditures and revenues.
On my earlier Musing about anxiety in these fraught times, these thoughts from Mark DiMaria:
I can't help but note that despite these anxiety-inducing times, I am experiencing one of the least anxious phases of my life. Of course, there are two parts to it, the first and greatest for which I am deeply grateful… that I have my health (as far as I know), live in a war-free zone, am fed with a roof over my head, have a steady job with good income, am surrounded by a small but loving family, have a good education and relatively functional mind, and am nearing the end of a successful career… The second is that relative to many in our society, I do not engage in social media or watch television news, although I read a great deal about current events and culture, so I am well aware of the challenges we face. And while I have deep concerns about where this all is headed, I generally sleep well at night, perhaps because the flames of my angst have not been consciously stoked by others attempting to prey on my anxieties.”
Have a great day,