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Sunday, October 29, 2006
How did that happen again?
In a long, poorly written piece about the federal budget deficit, we get to this explanation of how we got to the way things are:
People who remember Ross Perot's rants in the 1992 presidential election may think of the federal debt as a problem of the past. But it never really went away after Perot made it an issue, it only took a breather. The federal government actually produced a surplus for a few years during the 1990s, thanks to a booming economy and fiscal restraint imposed by laws that were passed early in the decade. And though the federal debt has grown in dollar terms since 2001, it hasn't grown dramatically relative to the size of the economy.
...Why is America so fiscally unprepared for the next century? Like many of its citizens, the United States has spent the last few years racking up debt instead of saving for the future. Foreign lenders — primarily the central banks of China, Japan and other big U.S. trading partners — have been eager to lend the government money at low interest rates, making the current $8.5-trillion deficit about as painful as a big balance on a zero-percent credit card.
...The current political climate doesn't help. Washington tends to keep its fiscal house in better order when one party controls Congress and the other is in the White House, says Sawhill.
Why is America so fiscally unprepared? In part, perhaps small part, because of silly articles like this, which wave their hands over how the fiscal picture has changed in the last 15 years.
We went from huge deficits to a surplus back to huge deficits. We ended the deficit thanks to Bill Clinton's budget plan -- a plan which passed without any Republican support in Congress. A very modest increase in income taxes combined with strong economic growth resulted in a short-lived surplus. Al Gore promised to protect the surplus and shore up Social Security. George Bush has spent the surplus many times over and has created a permanent, structural deficit. He spent the surplus on tax cuts for the super-wealthy, tax cuts for the super-wealthy, and tax cuts for the super-wealthy. Plus, of course, a ridiculously expensive Medicare prescription drug bill designed primarily to ensure the health of pharmaceutical companies and $400 billion war in Iraq.
One party has managed the federal budget far better than the other. One party has shown a willingness to make hard choices. One party -- the Democratic party -- takes the deficit seriously. That's the history. The policy choices are stark. Why this AP article can't mention the basic mechanics of the deficit is beyond me.
4 Comments:
Credit where it's due: Bush I's breaking of his "read my lips" pledge led to a tax hike that deserves at least some credit for the balanced budgets in the 90s.
A fair point. That would've been a good addition to my post as well as the original article.
Not to mention Johh Kasich's heavy lifting in the House Budget Committee.
By 
Joey de Vivre, at
6:40 AM
So the real question is why three guys sitting around in their spare time manage to give, off the tops of their heads, a more complete picture than professional journalists?
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