A Democratic Deficit

This article is from the archive of The New York Sun before the launch of its new website in 2022. The Sun has neither altered nor updated such articles but will seek to correct any errors, mis-categorizations or other problems introduced during transfer.

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No sooner were the latest budget projections by the Office of Management and Budget released yesterday than Democrats were whipping themselves into a frenzy of outrage at President Bush. “This administration will now leave office with the worst record of fiscal responsibility in the history of the country,” said the Democrat who chairs the Senate Budget Committee, Kent Conrad. “If we gave Olympic medals for fiscal irresponsibility, President Bush would take the gold, the silver, and the bronze, because he’s got the three highest record deficits ever.” The Democrat who chairs the House Budget Committee, John Spratt, said, “this in a nutshell is the Bush Administration’s legacy: Mr. Bush entered office with the biggest surpluses in history and leaves with the biggest deficits.”

They doth protest too much. Funny how it is that before the Democrats took over Congress, the deficit was shrinking. We began our July 12, 2007 editorial, “The Incredible Shrinking Deficit,” with a list of the deficit numbers for the Bush administration, as follows:

2004: $413 billion

2005: $318 billion

2006: $248 billion

2007: $205 billion

We noted that as a percentage of GDP, the decline was even more striking:

2004: 3.6%

2005: 2.6%

2006: 1.9%

2007: 1.5%

We followed up on August 24, 2007 with another editorial, “The Incredible Shrinking Deficit II,” with even better news, from the Congressional Budget Office:

2004: $413 billion

2005: $318 billion

2006: $248 billion

2007: $158 billion

And, as a percentage of GDP:

2004: 3.6%

2005: 2.6%

2006: 1.9%

2007: 1.2%

So here we are, the first full year after a Congress in which the Democrats controlled the power of the purse, and what do we find? The Party of Reid, Schumer, Obama, Pelosi, and Clinton is shocked, shocked, to find the deficit growing again, even after they joined to pass a “stimulus” package that consisted of sending checks to families making less than $150,000 a year. Where did they think the money for those checks was going to come from if not from an expanded deficit?

Already demands are growing in Washington to stimulate the economy with a second round of “stimulus.” One of Senator Obama’s economic advisers, Robert Reich, is suggesting a second stimulus of $200 billion, focused on “infrastructure.” Another one, John Sweeney, who is president of the AFL-CIO, has called for “a second economic stimulus bill that includes extended unemployment benefits, expanded food stamps program, aid to states and cities, and infrastructure spending.”

This isn’t stimulus, it is spending, and it will eventually have to be paid for by either borrowing more money from the Saudis and Chinese or raising taxes on Americans. The latest deficit numbers are lower than they might be because they do not include the full costs of the Battle of Iraq or of the latest housing bailout, and they are masked by a Social Security surplus that will disappear once the Baby Boom generation starts reaching retirement age.

If Mr. Obama wins the White House, look forward to him using the deficit as President Clinton did, as an excuse to raise taxes and abandon his campaign promises of a middle-class tax cut. The deficit may balloon anyway, though, as a Democratic president is unlikely to impose spending discipline on a Democratic Congress. Meanwhile, Senator McCain is the rare Washington politician with credibility to run a campaign based on spending discipline. If he can combine it with the language of growth-inducing tax cuts, he may yet find electoral success as a candidate running against the Democratic deficits.

NY Sun
NEW YORK SUN CONTRIBUTOR

This article is from the archive of The New York Sun before the launch of its new website in 2022. The Sun has neither altered nor updated such articles but will seek to correct any errors, mis-categorizations or other problems introduced during transfer.


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