(Infographic: Cumulative US Federal Debt in Constant $2008
by Evan Robinson, Group News Blog)
With Obama's SOTU and proposed FY2010 budget out there in the wild, I've been thinking about accumulating national debt. (Yes, I'm weird. Get over it. At least my weirdness means you don't have to think about national debt. I did this stuff today for fun. Really.)
1) obviously, any sitting President is not entirely responsible for the budget which gets passed, as Congress gets lots of fingers in the pie. However, the President does propose a basic budget and set priorities, so I'm at least somewhat comfortable hanging the budget on the sitting President;
2) the US government fiscal year does not correspond conveniently to elections or swearing in of new officeholders. I have assigned budgetary responsibility for a given fiscal year to whomever signed the President's Budget Message for that fiscal year. Thus GW Bush gets stuck with FY2009 even though Obama was elected in November 2008 and took office in January 2009. This assignment is consistent back until 1950;
3) because there would be lots of "but Obama did...", I have included an estimate of debt increase for FY2010. As with any estimate, it may or may not be right. Because of the nature of constant dollars, there are actually two estimates involved -- one for the growth of debt and one for the inflation rate;
4) I have a rather unique, but simple, definition of deficit -- the amount our national debt goes up in a year. This is not the same number as reported, but accurately reflects the concept of deficit.
Let's start with the obvious: although Dick Cheney says that deficits don't (and by extension, cumulative national debt doesn't) matter, most economists disagree. Some rather violently. Some analysts have suggested that our current D&D (Debt & Deficit, get it?) numbers may be responsible for a substantial fraction of the current price of oil -- a matter that touches pretty much everybody on Main Street.
I am something of a Keynesian (not that my opinion matters compared to, say, Paul Krugman's) -- I believe that government spending (and thus potential deficits) have a stimulative effect. Therefore, in difficult economic times, deficits are appropriate, especially to the extent that they build and support our internal economy and extend our infrastructure.
But while we watch the blood sport of assailing President Obama for his enormous proposed deficit, let's not forget how our debt happened.
Between FYs 1950 and 2009 inclusive, 84% of our cumulative national debt (roughly $9.2 trillion out of $11 trillion of debt) has been created under Republican Presidents. Reagan / Bush I / Bush II between them are responsible for nearly 80% ($8.75 trillion)! Republican Presidents have:
- more than doubled the debt (Bush II 127%)
- tripled the debt (Nixon/Ford 194%)
- quintupled the debt (Reagan/Bush I 479%).
Democratic Presidents, on the other hand, have at most raised the debt by 80% (Carter). On average, a Democratic President increases the debt $73.4 billion every year, while a Republican President increases the debt $255.7 billion, roughly 3.5 times as much.
Like any family, the US Government must ultimately learn to live within its means. A good start on doing that would be to keep the wild spending Elephants away from the bank account, wallet, and credit cards.