What do you get when you elect a die-hard tax and spend liberal in the White House? The biggest deficits since Harry Truman was in the White House.
The political strategy behind Obamanomics was always simple: Call for “stimulus” to rescue the economy, run up the debt with the biggest spending blitz in 60 years, and then when the deficit explodes call for higher taxes. The Congressional Budget Office annual review released yesterday shows this is all on track.
CBO reports that annual spending over the Obama era has climbed to a projected $3.6 trillion this fiscal year from $2.98 trillion in fiscal 2008, or more than 20%. The government spending burden has averaged 24% of GDP, up from an average of about 20%. This doesn’t include the $2 trillion tab for ObamaCare.
All of this has increased the federal debt by about $5 trillion in a mere four years. Thanks to higher revenues, the federal deficit will decline to $1.08 trillion in 2012, or 7% of GDP. But that is still the highest deficit since 1946—except for the previous three years. In other words, the four years of the Obama’s Presidency will mark the four highest years in spending and deficits as a share of the economy since Harry Truman sat in the Oval Office.
And don’t forget the national debt held by the public—the kind we have to pay back. On President Obama’s watch, CBO says public debt will climb this year to 72.5% of the economy from 40.3% in 2008. This isn’t as high as Italy or Greece, but it’s rising fast toward the 90% level that begins to debilitate an economy.
We pause from this gloom for some good news: Despite the abuse they’ve taken, House Republicans have made some fiscal progress. CBO estimates that overall federal spending in 2012 will grow by only $3 billion, or less than 1%, which compares with double digit increases during the Obama-Pelosi years. Republicans have also tried to reform entitlements, but Democrats wanted a $1 trillion tax hike ransom for even modest cuts, which was wisely rejected.
Read more of the editorial at this link.