Changes in Federal Spending, Annually, By President

I've been watching the partisans battle it out over the debt ceiling, and marveling at the way numbers are thrown around without particular regard for things like accuracy. I've had so many different articles and posts come up that caused immediate cognitive dissonance. When I get that sensation, I go for references.

So, here's a nice list that I've reduced from a wikipedia table with figures about the rates of increased spending. Yes, only increases. Since 1994, federal spending has only increased. The last time it actually decreased was 1993, under George HW Bush.

1994 Clinton 1.7%
1995 Clinton 1.2%
1996 Clinton 0.7%
1997 Clinton 0.7%
1998 Clinton 2.2%
1999 Clinton 1.9%
2000 Clinton 2.5%
2001 Clinton 1.8%
2002 Bush 6.0%
2003 Bush 4.6%
2004 Bush 3.2%
2005 Bush 4.0%
2006 Bush 3.9%
2007 Bush 0.6%
2008 Bush 4.6%
2009 Bush 3.6%
2010 Obama 1.4%

Seems like the magic formula is Democratic President, Republican Congress- not that any of them reduced the size of government in this time. They all grew it. But nothing grew it like Republican President, Republican Congress.

So, the rhetoric about the size of government not growing is bullshit. Likewise, the rhetoric about spending not growing is bullshit. And the rhetoric about Republicans being the party of smaller government is the biggest steaming pile of the purest, pungent, unmitigated bullshit ever foisted upon a gullible public.

One-Eyed Views Of Economics

I swear, the willful ignorance is growing and growing. There are two ways to balance budgets: increase income, and decrease spending. In any responsible person's personal budget, the first thing one does when the income sags is to cut spending. Not borrow and spend. Cut. Then, after stabilizing the budget, look for other sources of income.

Well, I used the word 'responsible'. So, here comes the 'Chart of the Day' from Reuters.
Oh, I love the one-eye blind preaching in the article:

This chart should be ingrained in the mind of anybody who cares about fiscal policy. The main things to note:

• Federal taxes are the lowest in 60 years, which gives you a pretty good idea of why America’s long-term debt ratios are a big problem. If the taxes reverted to somewhere near their historical mean, the problem would be solved at a stroke.

Here's the foil, because one good chart deserves another, and because I care about policy, without taking the belief that all we're spending on right now is good, necessary, and proper:And, using the above Reuter's paragraph as a building block, here's the other side of the coin:

"Federal taxes are spending is the lowest highest in 60 years, which gives you a pretty good idea of why America’s long-term debt ratios are a big problem. If the taxes spending reverted to somewhere near their historical mean, the problem would be solved at a stroke."

So, let's end with an update to their conclusion:

If you were structuring a tax code budget from scratch, it would look nothing like this. But the problem is that tax hikes budget cuts seem to be politically impossible no matter which party is in power. And since any revamp of the tax code budget would involve tax hikes cuts somewhere, I fear we’re fiscally doomed.

Federal fiscal policy goes like this: We're committed to spending, so let's figure out ways to get the money. Why are we committed to spending what we're spending? Anyone have any interest in that? Why are so many elected officials, and worse, pundits, willing to accept that all spending is good, and must, I mean MUST, be underwritten?

This position is the extreme on one end. I'm not the extreme on the other. I'm not saying 'Cut it all!" I'm saying, "Let's cut to the historical mean." That's a moderate position.

Note to my Democratic friends: Look at the spending as % of GDP chart. Remember the Clinton years? You know, the ones that were so glorious, at least as heard told during the 2008 campaign season? What did federal spending do during that shining era of surplus? Yeah. It went down. Then, it went up sharply in the middle of the Bush years, and continued upward sharply into the Obama Administration. Over to the tax chart, you'll notice that taxes went up during the early Bush years, and then down in the middle and into Obama's term.

What? I'm Not Alone?

Well if this isn't like a cool drink of water in the scorching desert, I don't know what is. There is someone else out there who believes that there is more than one way to balance a budget! Obama says, "Raise taxes". Glenn Hubbard of Columbia University shares my view: drastically cut spending. From his Wall Street Journal op-ed:

In short, Mr. Obama has articulated a plan for higher federal spending, leaving open the question of what tax increases are next.

If Mr. Obama is going to increase spending, will he raise the money by higher business taxes instead? He has already distanced himself from John McCain's call to reduce America's corporate tax rate, and he is committed to raising tax rates on successful small business owners who pay individual as opposed to corporate income taxes. Does this mean he will raise tax burdens on individuals with annual incomes less than $250,000?

In a June 26 interview on the Fox Business channel, Mr. Obama said he wanted to roll back the Bush tax cuts for those in the top 5% of incomes -- that is, about $145,000 per year. He also voted for the Democrats' fiscal year 2009 Budget Resolution, which would raise taxes on individuals earning $42,000 or more.

There is another fiscal way. Balancing the federal budget without a tax increase is possible, but will require strong fiscal restraint. To achieve full-employment budget balance by the end of the next president's term in office, federal nondefense spending growth needs to be restrained to 2% per year instead of the currently projected 4.5%. And modest defense spending increases to fund costs of needed improvements in national security are possible.

That seems really simple, actually. Not even cut the budget, but have it grow more slowly, and you're on your way. Seems to me if an actual fiscal conservative were elected, we might be able to eradicate the deficit in four years or so.

Now, it's fair criticism to say that this man isn't likely to be listened to. After all, he was an advisor to George W. Bush, who grew spending like never before. But it's in the Wall Street Journal, and somebody's reading it. There's hope!

Now, while Hubbard is obviously saying these things in the hopes of boosting McCain, there's no reason for anyone who cares about policy to believe that McCain is going to be the fiscal conservative. He certainly hasn't been while in the Senate.

There is one candidate talking about cutting spending. Nudge, nudge.