With the signing of the Congressional budget deal on November 2 and sale of at least another $1.5 trillion in Treasury debt before he leaves office, President Obama will have earned title: “Mr. $20 Trillion.”
Obama’s first Chair of the Council of Economic Advisors, Christina Romer, promised from the White House in January 2009 that with the help of the veto-proof Democrat Congress passing the $787 billion stimulus package, America would return to sustainable growth and drive unemployment from 8.1 percent to 5.5 percent by the third quarter of 2012.
Barack Obama followed up the expected good news at his Fiscal Responsibility Summit on February 23, 2009 by promising an enthusiastic crowd of supporters and academics:
And that’s why today I’m pledging to cut the deficit we inherited by half by the end of my first term in office. This will not be easy. It will require us to make difficult decisions and face challenges we’ve long neglected. But I refuse to leave our children with a debt that they cannot repay–and that means taking responsibility right now, in this administration, for getting our spending under control.
Congress did pass the President’s economic recovery plan, allowing U.S. government spending to rise by over 18 percent from $2.98 trillion in 2008 under President Bush to an average of $3.53 trillion during the first four years of the Obama Presidency. But the President’s plan failed to stimulate the economy as the unemployment rate was down only slightly to 7.8 percent by September 2012, and would rise back up to 8 percent by the end of the President’s first term.
Rather than the U.S. debt being cut in half, Obama led the greatest debt expansion in history as the United States debt rose over 25 percent in his first four years, from $9.99 trillion to $14.05 trillion.
The current national debt is $18.15 trillion, but the budget deal will allow the Obama Administration to borrow an additional $2 trillion more, pushing the U.S. national debt to $20.1 trillion before Obama leaves office in January 2017.
In the first century after Secretary of the Treasury Alexander Hamilton refunded the debts of the American Revolutionary War with a federal debt, the United States only went into debt to pay for its wars. But President Franklin D. Roosevelt attempted to pull the nation out of the Great Depression by pushing the net national debt up from about 21 percent to an unheard-of 39 percent of GDP.
President Obama will have set the record by doubling the size of the U.S. debt in just eight years to over $20 trillion. The net national debt as a percentage of the United States economy will have risen from about 47 percent of GDP when he was first elected to 94 percent of GDP before he leaves.
Under President Obama’s leadership, the combined debt of all federal, state and local governments will have risen to over $23 trillion, or about 120 percent of America’s GDP.