The most important chart on the Obama budget?
August 11th, 2010
Oh yes…there are many things worth pointing out in this chart showing the deficit to GDP of the Bush and Obama administrations, based on numbers from the Congressional Budget Office (CBO).
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The Bush administration averaged debt that was less than the historical average of past presidents for his entire two terms, only rising above that in the crash year of 2009, (when he obviously was not in office anymore, but was still largely responsible for the budget.) But that’s NOT the most important thing either.
In 2009, the projected Bush budget deficit was 8.3% of GDP, by the time Obama was done with it–it had skyrocketed even further—to 9.9%. But that’s NOT the most important thing either.
Even when you include the entire crash year of 2009, Bush still averaged only a 2.7% debt to GDP ratio—the historical average is 2.6%. Throw in the fact that he had 9-11, corporate scandals that started long before he was in office, and the great recession—that’s pretty amazing. Even as a partial Bush apologist, that surprised me. But that’s NOT the most important thing either.
The average deficit of the Bush years was 2.7%, the average of the theoretical deficit of two terms of Obama is 6.4%. But, that’s not the most important thing either.
What is? The years 2014-2020. Let’s say you blame the entire crash on Bush, and give Obama 6 full years to make up for it. If everything goes according to plan, Obama’s deficit falls to 4.1% of GDP in 2014. Yes, that’s still worse than any full Bush year, and 58% worse than the historical average—but the most vital thing is what happens NEXT. Even after he magically “steadies the economic ship”—the deficit is projected to GET WORSE EVERY YEAR UNTIL 2020, which is when estimates stop.
Even using rosy government estimates—there is no balanced budget under President Obama. There is no year that beats Bush’s worst full year. There is no year that approaches the historical average of past presidents. And, even after the crash passes, Obama continues to make things worse, and worse, and worse.
For once I agree with Obama. He is “bending the curve.” Perhaps we should focus on what way it’s being bent.
Read a very solid analysis of these facts by Keith Hennessey here
UPDATE: A comment that points out another important observation:
Chris Norman Aug 11
One very important thing is missing from the graph. Senator Barack Obama and the Dems controlled the Senate and the House after the 2006 election. Congress controls the deficit, not the President, except for vetoes. If you consider that, the deficits in the last 4 years up to 2006 were decreasing. Once the Dems took over, the curve bends up dramatically.
For all of you aspiring graph-geeks out there, remove the financial crisis by drawing a line from 2007 to 2014 and see the frightening yet consistent rise…