How did we get to Trillion Dollar Deficits?
It is always useful to go inside the numbers.
First, here are the deficits since 2000:
Now, one of the things that I think needs to be noted: we hit a $1 trillion deficit before President Obama was able to introduce a budget. This is relevant because it is indicative of the fact that it is a problematic argument to make that the reason we have hit $1 trillion deficits is because we had some kind of radical shift in ideological perspective of the occupant of the White House (otherwise known as the “It’s the crazy socialist’s fault” hypothesis—i.e., that the PPACA and the stimulus are the fundamental problems). Rather, a combination of policy choices and a massive recession brought us to this point.
Now, what policies can be seen as contributing to these deficits?
Source for the above: the NYT.
Now, it is fair to point out: the Obama administration has continued the wars in Iraq and Afghanistan (although we have been drawing down in Iraq) and it also agreed to extend the Bush tax cuts—not to mention that the Medicare Part D program continues and so forth).
Now, it is clear that we have serious deficit spending by both administrations, but it strikes me as important to take an honest assessment of where recent spending trends started and for what purpose. To me this is not about Bush v. Obama, but simply a question of facts.
Another graphic worth considering:
Source: the NYT.
Of the things that should also be clear: stimulus spending is not the main problem.
Something else to consider (which is part of the above) is defense spending.
Dan Drezner shares the following (source: the Heritage Foundation):
I have to agree with his basic reaction to the graph:
The striking thing about this chart is that we’re spending more on the military now than we did during the peak of Cold War tensions and Reagan’s military build-up in the mid-1980’s — especially since military spending by the rest of the world has fallen dramatically since the end of the Cold War.
It really is stunning. The notion that we need this level of defense spending is problematic (to be kind).
Drezner went on to quote himself:
I’m about to say something that might be controversial for people under the age of 25, but here goes. You know the threats posed to the United States by a rising China, a nuclear Iran, terrorists and piracy? You could put all of them together and they don’t equal the perceived threat posed by the Soviet Union during the Cold War. And until I see another hostile country in the world that poses a military threat in Europe, the Middle East and Asia at the same time, I’m thinking that current defense spending should be lower than Cold War levels by a fair amount.
I must concur.
I am also at a loss how people can claim that we aren’t spending enough to “keep us safe” (and yes, I am looking at people like Jennifer Rubin). Indeed, that was the point of Drezner’s post. The idea that defending against terrorism needs to be more expensive than the Cold War should be considered ridiculous on its face, and yet…
At any rate: the problems that we face are not solely the domain of the current administration and are certainly not the result of a failure to pass a budget.* The story is a tad more complex than that.
*BTW, I will note that I think that failure to pass a budget is an abrogation of a basic responsibility of the Congress. However, that’s not why we have deficits, nor is it the reason why we are at an impasse over the debt ceiling (although I have heard any number of people assert that somehow these things are linked).