Keith Hennessy on Barack Obama’s Bart Simpson defense.
I would add that it’s not possible to know to what degree “tax cuts” boosted the deficit, because they weren’t “tax cuts.” They were tax rate cuts, and they may have actually reduced it by boosting the economy and incomes.
It’s perfectly possible to indicate that revenue is substantially short of January CBO projections, and spending is about the same as the CBO projected. You could make a “it’d be worse without the tax (rate) cut” argument, but a policy that leads to less revenue is fairly called a “tax cut” I think.
I would add that it’s not possible to know to what degree “tax cuts” boosted the deficit, because they weren’t “tax cuts.”They were tax rate cuts, and they may have actually reduced it by boosting the economy and incomes.
By the same token, ARRA spending may not increase the deficit, because the road-not-taken might have have included a much deeper recession with “automatic stabilizer” spending exceeding what will be spent on ARRA.
Advocates of both tax rate cuts and stimulus spending can plausibly (if not convincingly) argue that their favored policy is not as fiscally harmful as the CBO projects, but the CBO scoring is the best apples-to-apples comparison we have. And by that scoring the Bush tax cuts — which, contra Hennessey, Obama is working to change — added trillions to the debt.
the Bush tax cuts….added trillions to the debt
You don’t add to debt by cutting revenue, you add to debt by *spending* more than you take in. Bush allowed the Republicans to spend like Democrats. Tax (rate) cuts are helpful, but if they accompany increases in spending then they’re not going to do enough in and of themselves.
And now we’ve got the tax-and-spenders back in control, so the debt’s worse than ever, and unlikely to go down in our lifetimes. Hope! Change!
In fairness, Bush pushed some of that himself. The Medicare prescription drug benefit was the biggest new entitlement program in over 40 years.
Unfortunately, there is no party with the credibility required to criticize the Republicans on entitlement spending.
I love the implication of victim status behind the statement: “Obama inherited…” It’s as if he was taken completely by surprise, compelled by forces beyond his control into a job cleaning up a mess about which he had no advance knowledge whatsoever. Like finding out that a relative he didn’t know he had died, and left him a million dollars — of debt.
The problem I have is that tax cuts are not deficit spending. They reduce income which in turn means you must reduce your spending but in themselves they don’t cause spending and to use them as an excuse for debt is nonsense. Budget income must be forecast then spending adjusted to fit. This has not taken place in so many years but isn’t this basic stuff? Yes I’ve simplified this severely.