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Title: The Budget Deficit, The Real Story
Source: [None]
URL Source: http://thedmichaelwallerreport.blog ... budget-deficit-real-story.html
Published: Aug 9, 2010
Author: thedmichaelwallerreport
Post Date: 2010-08-09 13:06:18 by no gnu taxes
Keywords: None
Views: 24694
Comments: 46

The Washington Post babbled again today about Obama inheriting a huge deficit from Bush.

Amazingly enough, a lot of people swallow this nonsense (AKA Horseshit). So once more, a short civics lesson is in order.

Budgets do not come from the White House. They come from Congress, and the party that controlled Congress since January 2007 is the Democratic Party. They controlled the budget process for FY 2008 and FY 2009, as well as FY 2010 and FY 2011. In that first year, they had to contend with George Bush, which caused them to compromise on spending, when Bush somewhat belatedly got tough on spending increases. For FY 2009, though, Nancy Pelosi and Harry Reid bypassed George Bush entirely, passing continuing resolutions to keep government running until Barack Obama could take office. At that time, they passed a massive omnibus spending bill to complete the FY 2009 budgets.

And where was Barack Obama during this time? He was a member of that very Congress that passed all of these massive spending bills, and he signed the omnibus bill as President to complete FY 2009. Let's remember what the deficits looked like during that period:

If the Democrats inherited any deficit, it was the FY 2007 deficit, the last of the Republican budgets. That deficit was the lowest in five years, and the fourth straight decline in deficit spending. After that, Democrats in Congress took control of spending, and that includes Barack Obama, who voted for the budgets. If Obama inherited anything, he inherited it from himself.

In a nutshell, what Obama is saying is I inherited a deficit that I voted for and then I voted to expand that deficit four-fold since January 20th.

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Begin Trace Mode for Comment # 22.

#9. To: no gnu taxes (#0)

hey come from Congress, and the party that controlled Congress since January 2007 is the Democratic Party. They controlled the budget process for FY 2008 and FY 2009, as well as FY 2010 and FY 2011. In that first year, they had to contend with George Bush, which caused them to compromise on spending, when Bush somewhat belatedly got tough on spending increases. For FY 2009, though, Nancy Pelosi and Harry Reid bypassed George Bush entirely, passing continuing resolutions to keep government running until Barack Obama could take office. At that time, they passed a massive omnibus spending bill to complete the FY 2009 budgets.

Who ran the Congress when two huge tax increases were passed, along with massive new spending on Medicare and wars, without any of it being paid for?

go65  posted on  2010-08-09   14:23:36 ET  Reply   Untrace   Trace   Private Reply  


#10. To: go65 (#9)

Lets start with President Bush's record 12 months post the recession ended in July of 2003. In a note to clients around that time (June 17/2004 to be precise), I wrote.."...we have been getting more good news on the booming US economy"...some of the economic data points that I referenced at the time included:

* initial jobless claims dropped 15k to 343k.

* capacity utilization rose to 77.8%

* industrial production rose 1.1% in May (strongest in 6 years)

* factory production rose 6.4%, the biggest increase since April 2000

* housing starts strong at an annual rate of 2.12 million which surpasses previous years 1.85million, the most in 25 years.

-------------------------

Now, fast forward to 2010. We have a complete tly different picture 12 months following the end of the most recent recession. In fact...the policies implemented by the current administration have produced quite a different, more negative economic environment that Fed Chairman Bernanke describes as one with "unusual uncertainty". The failure of these stimulus policies have led many to fear the dreaded 'double dip". So lets look at President Obama's record one year post recession end:

* Consumer confidence remains low

* Stocks are hugging the flat line year to date

* The housing market remains in the doldrums not responding to record gobs of stimulus money

* Consumer spending and incomes are stagnating according to data released this AM

* Bernanke is quoted as saying today that the economy is still short of full recovery

* Treasury Secretary Geithner is saying today that unemployment will get worse before it gets better.

* GDP growth slowed in the 2nd qtr to 2.4% from 3.7% in 1st qtr.

* Growth in the manufacturing sector is moderating

* Unemployment remains stubbornly high bordering on double digits at 9.5%

* Jobless claims continue to average over 450k

* Friday's jobs report is expected to show a second month of net job losses

* The Fed may be getting desperate as the rumors of QE Part Deux escalate

* Impression that the Fed is "pushing on a string" have surfaced

* Flattening yield curve

* Rising Deficits and Debt are a growing concern with increased entitlement spending

* Confusion about impact of Fin reg and New Health Care legislation leading to "unusual uncertainty" which has catalyzed record levels of corporate cash sidelined

* The dreaded double "D's" Deflation and Deleveraging are on the radar!

* Capacity Utilization remains below 75%

no gnu taxes  posted on  2010-08-09   14:28:07 ET  Reply   Untrace   Trace   Private Reply  


#17. To: no gnu taxes (#10)

housing starts strong at an annual rate of 2.12 million which surpasses previous years 1.85million, the most in 25 years.

Game over...

war  posted on  2010-08-09   16:05:00 ET  Reply   Untrace   Trace   Private Reply  


#18. To: war (#17)

* The housing market remains in the doldrums not responding to record gobs of stimulus money

game over

no gnu taxes  posted on  2010-08-09   16:14:01 ET  Reply   Untrace   Trace   Private Reply  


#22. To: no gnu taxes (#18)

The housing market absolutely benefited from the stim. You'd be hard pressed to find a consensus that would not point to the housing credit expiring and the resulting downturn in housing as being interdependent.

war  posted on  2010-08-09   19:59:27 ET  Reply   Untrace   Trace   Private Reply  


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