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How Bush Administration Policies Caused the U.S. Fiscal Year 2015 Budget Deficit

November 28, 2010

The New York Times has released a tool on its website which shows how different budget cuts and tax increases will effect the Fiscal Year 2015 Budget. As its title states, it basically lets you balance the budget.

Not surprisingly, if you remove the Bush-era tax cuts on income and inheritance, wind down the war in Afghanistan and Iraq to 30,000 troops deployed, and reduce the military to the pre-Iraq war size you have solved 87% of the 2015 budget shortfall, and 46% of the 2030 Budget shortfall. This should come to no surprise to those remember the Clinton years. After all, whether or not you like him, Clinton left president George Bush Jr. with a budget surplus.

Analysis

Regardless of policy discussions over whether or not the wars in Iraq and Afghanistan were necessary, it seems reasonable that the Bush administration’s two biggest policy initiatives: tax cuts and two wars would lead to a budget deficit.  Interestingly enough spending on the two wars and the tax cuts were passed under Bush in such a way that they did not appear on the budget. The wars were largely funded through supplemental budgets, keeping them off the official balance sheets, while the tax cuts “temporary” status allowed them to evade Ronald Reagan’s Balanced Budget and Emergency Deficit Control Act which required tax cuts be offset by spending cuts. In the long-term there is certainly a problem with the U.S. budget, however in the short-term with the economy in shambles it seems bizarre that many are calling for Obama to cut spending because of a budget shortfall handed to him by the previous administration’s spending spree. At the least, it is hypocritical for “tea-party” type conservatives to decry the annual deficit when 87% of it comes from policies they likely supported.

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3 Comments leave one →
  1. Caddy Jim permalink
    July 14, 2015 12:46 pm

    Tax Cuts Have A Benefit When Their High So Kennedy Lowering Taxes From 91% To 70% Was Good Where It Stayed & The Debt Was Less Than $1Trillion While Also Investing In The US Infrastructure NASA, The Space Race & Even The Vietnam WAR Until The 80’s Where Reagan Cut Taxes To A Meer 28% Which Had & Has Short Term Benefits Followed By Boom Bust Economy. PPL Need To Quit Comparing A Gov. Debt With House Hold Debt. PPL Cant Do A lot Of Things Gov. Can Like Print Money

    The Right Like To Complain The Left “TAX & Spends” While In Reality The Right [Cuts Taxes (On The RICH) & Spends Specially On The Military] Our Currant Debt Is From The Last 3 Rep Presidents. Besides Shown By The Great Depression Go. Investment Helps The Economy PPL Forget hats What Paid For WWll & All The Jobs But Not Only The WR But Before & After With Investments In Infrastructure (Dams, Bridges, Roads, Ect.) Would Just Add One Of Our Greatest Problems Is “INFORMATION” Many Americans Are “Uninformed” & Even Worse & Growing Are The “Misinformed” Shown By Most Not Knowing How Bad Income Inequality Is & Has Got At The Hands Of The RICH Not Seen Since The Roaring 1930’s Leading To The Great Depression.

    When It Comes To BUSH Jr. Spending While Starting A Second IRAQ WAR Was Unnecessary & Costly & Took Focus & Supplies Away From The Afghan WAR. But Beyond All That What Make BUSH Spending The Worst & A First In US History Is He Went WAR Without Raising Taxes To Help Pay For The WAR & Make Everybody Do Their Part But Instead Cut Taxes (During A WAR A First In US History) Mainly On The RICH. Then Started A Second WAR (Unnecessary & Costly $2+Trillion) But Then Cut Taxes Again On The RICH While Fighting Not One But Two WARS (A First In US History) & H Was Given & Started With A Budget Surplus. So Lastly This Proves Republicans Are Not “Conservatives” Since Are Current Debt Was Caused By The Last 3 Republican Presidents. It’s Just A Play On Words So When Americans Who Think Of Themselves As Conservatives Based On The Definition Many Are Likely To Vote For Somebody Who Calls Themselves A Conservative.

Trackbacks

  1. Historic Chart of U.S. Debt to GDP Ratio « floodingupeconomics
  2. Obama versus Bush on the Deficit « floodingupeconomics

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