A Rex Nutting article in Marketwatch claiming the President has been a budget hawk has generated a lot of comment, much of it mistaken. Due to what I call The Lesser-Known Law of Large Numbers, most people’s brains go on the fritz when they deal with numbers much larger than a bar bill. Because of this effect, most commentators have gotten the facts wrong. I’m immune to this law, and so I’d like to address the flaws in Mr. Nutting's data.
The White House is promoting the column to prove their fiscal probity, so his opponents need to get their facts straight in order to demonstrate just how profligate his spending has really been. Nutting claims that Obama has held the line on spending since sending up his first budget for the fiscal year 2010. The claim is based on the truism that all budgets are written the year before, so that Fiscal 2009 must have been written and signed by Bush before he left office with his tail between his legs. This is Mistake Number One. Having been thoroughly embarrassed, Bush had no interest in sending up a budget. The Democrats won a landslide? Fine, let them write the 2009 budget. Which they did.
Next, recall that Bush had pushed through TARP before leaving, which was $750 Billion in deficit spending. Nutting, like most commentators, adds this to Bush's deficit in 2008, when it passed. Mistake Number Two. In fact, Bush spent $400 Billion of TARP. He left $350 Billion for his successor.
Finally, the new President pushed through the Stimulus in Feb. 2009. This was $800+ billion added to the regular budget, which in itself was increased by $425 billion year-over-year by Reid, Pelosi, et al. Again, this being 2009, it falls to reason that this was Bush's spending, But as we saw, Bush left no budget and of course had no hand in the Stimulus. Altogether, spending increased at least $1.5 Trillion from Fiscal 2008 to 2009. The actual Bush deficit in 2008 was approximately $850 Billion (including the $400 Billion from TARP), and the Obama deficit in 2009 was actually $1.75 Trillion, including the remainder of TARP.
Nutting claims, in fine, that the 2009 $1.4 Trillion deficit was Bush's, and that since then Obama has merely maintained the status quo. To set the record straight, Obama more than doubled the deficit his first year, and has fiddled around the margins of debt in the two years since.
To put Obama's largesse in context, I'd like to make two contrasts. First, the total deficit for the eight Bush years was 2.2 trillion dollars. The total deficit for Obama’s first two years was $2.75 trillion dollars, even if you leave out TARP. Second, the last deficit of an all-GOP Capitol Hill, Fiscal 2007, was $162 billion dollars. The first deficit of an all-Democrat Capitol Hill, Fiscal 2009, was $1.4 Trillion dollars — nearly 10 times higher.
So if the Obama campaign wants to start claiming fiscal restraint, his opponents should welcome it. But they need to get their facts right. If the President asks voters to focus on numbers like these, his days in office are numbered indeed.