Bush promises that the next president will balance the budget
The White House released its proposed FY 2009 budget this morning, complete with pledge that the budget will be back in balance by 2012. Which is, um, three years after George Bush leaves office.
In the meantime, the Office of Management and Budget is projecting that, after several years of shrinking, the deficit will grow dramatically this fiscal year, to $410 billion (or $602 billion if you leave aside the Social Security surplus). The culprit is the slowing economy, and the $150 billion (or so) stimulus package that the prez is hoping to get through Congress. The OMB says deficit will be even higher in FY 2009, then will shrink dramatically as soon as the current president heads home to Texas. Oh, and most of the costs of the wars in Iraq and Afghanistan are left out.
With these projections in hand, we can now chart the fiscal performance of the past four administrations (I threw in the last couple of Carter years too just for the heck of it):
Chart by Feilding Cage/Time.com
Now I'm not any kind of fiscal absolutist. Given what's going on in the economy, I think it's a good thing that the deficit is going up this year. Also, the deficits of the W era haven't been quite as big as those under his dad and Ronald Reagan, and we survived those. But it's now pretty much certain that Bush will leave office having presided over a sharp deterioration in the nation's finances. At least it's nice that he's so confident his successor will clean up after him.
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While I always knew it was true, I was kind of depressed reading this morning that The Decider is going to be working on the 2009 budget for when he's already gone..even with (many I'm sure) modifications/rewrites by Congress, it will be his team negotating with them and him wielding veto power on bits he don't like - for the first year of whoever is elected and that we'll be living with the cowboy's fingerprints on 2009 (not that we won't in many other ways). Makes one want to move the government's fiscal year to start in May or something so new incumbents have a chance to get their priorities in there - you know the ones they get elected for...
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Hey - this is a good segue into another question I had, being about (un)balanced budgets. I was having a discussion with someone over the ol' tax cuts don't increase revenues mantra on the republican side with someone who is a member of libertarian party. (I liberally cut-n-paste links to your article to send him).
He countered with....the balanced budget multiplier. Now I did some reading over the weekend, and I don't think it helps his side of the argument, but then again, I couldn't find a description of BBM that was written in anything close to clear english. Got any good links? Want to take a crack at it?
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I don't get your libertarian friend's balanced budget multiplier reference. I mean, I looked it up and all it seems to say is that if you increase taxes by the same amount that you increase spending ... not much happens. What's the application here?
Also, the 2009 budget is for the fiscal year that starts this Oct. 1. So Bush will at least still be in office for the first 4 months and 20 days of it. But yeah, the May idea is interesting.
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Re: Oct 1 and Jan 20 - just sounds kind of like all my jobs when i start them - my predecessor promised what to who by when? erk.. not feelin the whole most powerful man in the free world vibe...
Re: BBM - Yeah, I kinda was scratchin my head about the whole thing, cause that's how I read it. I dug around for a while too and didn't come up with much other than maybe he meant the tax cut multiplier ($1 cut -> $2.33 in increased economic activity) but doing the math still works out to less net gov revenues. I suspect it was a head fake so he could get out of conversation and stop having core beliefs challenged.
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