The U.S. expressway to Greece
Obama’s deficits 8 times higher than previous presidents’
by Peter J. Thomas and Peter Ferrara
October 09, 2012
Source: Washington Times
When President Obama entered office, federal spending for fiscal 2008 already was way too high at nearly $3 trillion. Four years later, for fiscal 2012, Mr. Obama’s 2013 budget, released in February, shows he already has increased federal spending and the size of the federal government by more than 25 percent in just one term.
But that was just a warm-up for Mr. Obama. Obamacare, for example, does not even become fully effective until 2014 and is projected by the Congressional Budget Office (CBO) to increase federal spending by another $1.76 trillion by itself over the next 10 years. Mr. Obama’s 2013 budget proposes to increase total federal spending by another 53 percent by 2022, to $5.82 trillion, the highest government spending in world history.
Indeed, Mr. Obama’s 2013 budget proposes to spend a record $47 trillion over the next 10 years. America’s entire economy is just $15 trillion a year.
Mr. Obama can’t pretend that George W. Bush made him propose all that runaway government spending. Mr. Obama proposed that in his own 2013 budget, in his fourth year in office. When Mr. Obama was asking for our votes in 2008, he told the nation his budget policy would involve a “net spending cut.” In fact, he said precisely that during a nationally televised debate with Sen. John McCain. Does Mr. Obama not understand the plain English meaning of his own words?
Before Mr. Obama took office, federal spending had been fairly stable since World War II — for more than 60 years — at about 20 percent of gross domestic product (GDP). But Mr. Obama’s 2013 budget projects federal spending over his entire four years in office to average 24.4 percent of GDP, already increasing the federal government by nearly 25 percent. Federal spending over President Bush’s entire eight years and over President Clinton’s entire eight years was just less than 20 percent of GDP for each.
Mr. Obama’s 2013 budget projects that federal spending over the next 10 years will soar further, to 30 percent of GDP, increasing the federal government by half over the 60-year, postwar historical average (which reflects bipartisan consensus). CBO further projects that under current policies, federal spending as a percent of GDP will skyrocket to 40 percent by 2040, 50 percent by 2060 and 80 percent by 2080.
Add in 10 percent to 15 percent for state and local spending, and we are on the road to smash right through Swedish-style socialism all the way to the government commandeering the entire economy. Still, by vociferously opposing any entitlement reform to reduce spending and instead vastly increasing entitlement spending with Obamacare, Mr. Obama does nothing to take America off this path to Third World oblivion.
Before Mr. Obama became president, there never had been a deficit anywhere near $1 trillion. The highest previously was less than half a trillion, in 2008. The federal deficit for the last budget adopted by a Republican-controlled Congress was $161 billion for fiscal 2007. The budget deficits for each year Mr. Obama has been president have been eight times as much at $1.2 trillion or more, the highest in world history.
Mr. Obama’s 2013 budget shows that as a result, federal debt held by the public will have doubled during his four years as president. That means that in just one term, Mr. Obama will have increased the national debt as much as all prior presidents, from George Washington through George W. Bush, combined.
By 2022, Mr. Obama’s budget projects that national debt held by the public will total nearly $20 trillion. That would be the highest national debt for any country ever. The gross federal debt, which includes the money the taxpayers owe in the Social Security trust fund and similar federal debts, which also will have to be paid, is projected in Mr. Obama’s budget to total nearly $26 trillion by 2022, just over 100 percent of GDP that year.
Mr. Obama’s Office of Management and Budget projects that his budget would explode the federal debt held by the public to nearly 200 percent of GDP by 2022, close to twice the previous all-time record of 109 percent at the end of World War II. The Congressional Budget Office estimates that under current policies, federal debt held by the public would soar to 320 percent by 2050 and 700 percent by 2080.
If left unchecked, Mr. Obama’s policies will put America on the expressway to Greece, which collapsed into national bankruptcy when its national debt reached only 115 percent of GDP.
Peter J. Thomas is chairman of the Conservative Caucus. Peter Ferrara is senior fellow for budget and entitlement policy at the Heartland Institute and senior fellow at the National Center for Policy Analysis.