Bush Will Leave $482 Billion Deficit (Or More) To Successor
Campaign 2000 now seems like a galaxy away if you recall the Presidential campaign debates where Republican George W. Bush talked with Democrat Al Gore about the government surplus: the White House yesterday announced that Bush will leave a $482 billion deficit to his successor — and that’s a low count because it doesn’t factor in a few other things…such as the Iraq war.
The news immediately provided a hot, front-burner issue and an underscored context in Presidential Campaign 2008 for what many pundits predict will be a growing focus on the United States’ growing economic ills under the present administration. And if Bush expected a ringing defense from Republican Senator John McCain, he didn’t get it as McCain and Obama each blasted each other’s economic plans amid this report:
The White House predicted Monday that President Bush would leave a record $482 billion deficit to his successor, a sobering turnabout in the nation’s fiscal condition from 2001, when Mr. Bush took office after three consecutive years of budget surpluses.
And the bad news gets worse:
The worst may be yet to come. The deficit announced by Jim Nussle, the White House budget director, does not reflect the full cost of military operations in Iraq and Afghanistan, the potential $50 billion cost of another economic stimulus package, or the possibility of steeper losses in tax revenues if individual income or corporate profits decline.
The new deficit numbers also do not account for any drains on the national treasury that might result from further declines in the housing market.
And WORSE:
The White House forecast was prepared before passage of the huge housing assistance package that Mr. Bush has promised to sign. That legislation would put taxpayer money at risk in numerous ways, especially if housing prices continue to decline.
Mr. Nussle predicted Monday that the deficit would more than double in the current 2008 fiscal year — to $389 billion, from $162 billion in 2007 — before shooting up to $482 billion in the 2009 fiscal year, which begins in about two months.
Meanwhile, on the campaign trail, where Democratic Senator Barack Obama battles Republican Senator John McCain in a Presidential race surprisingly tight given the country’s economic ills, both candidates essentially said they would not become financial clones of Bush while blasting each other.
The Obama campaign said the White House announcement is “an urgent reminder that our fiscal policies must change.”
“These have been years of unprecedented fiscal irresponsibility. That’s an important issue in this election because Sen. McCain is proposing to continue the same Bush economic policies that put our economy on this dangerous path and that will drive America even deeper into debt,” said Jason Furman, Obama’s economic policy director.
Furman said Obama will “restore balance and fairness to our economy by cutting wasteful spending, shutting corporate loopholes and tax havens, and rolling back the Bush tax cuts for the wealthiest Americans, while making health care affordable and putting a middle class tax cut in the pocket of 95 percent of workers and their families.”
But McCain clearly was trying to put some distance between himself and the Bush administration:
McCain called the Bush administration’s announcement “another reminder of the dire fiscal condition of the federal government.”
“There is no more striking reminder of the need to reverse the profligate spending that has characterized this administration’s fiscal policy,” he said.
That’s not a ringing defense. But McCain is making the argument that Obama isn’t the person to straighten the mess out:
McCain called the Bush administration’s announcement “another reminder of the dire fiscal condition of the federal government.”
“There is no more striking reminder of the need to reverse the profligate spending that has characterized this administration’s fiscal policy,” he said.
The bottom line: you can see by the outlines of this debate part of George Bush’s legacy that will be noted not just in the campaign season, but by future historians.
And, as political scientist Larry Sabato has noted (we regularly run his columns on TMV and Sabato has one of the best track records in predicting elections) McCain’s big problem is going to be that, no matter what he says, he has the same party affiliation as Bush:
Professor Larry Sabato, a political analyst at the University of Virginia, says McCain’s economic Achilles’ heel is his same-party affiliation with Bush. “People always blame the incumbent for bad economic times,” he says. For Obama, a possible weakness is his tax policy–but only “if McCain plays it right.” The Republican candidate not only has to show how Obama would raise taxes; he must also show voters how it would affect them, Sabato says.
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17 Responses to “Bush Will Leave $482 Billion Deficit (Or More) To Successor”
Of course, there is no real way that Senator Obama can cut taxes, increase spending, and make a dent in the budget deficit.
Senator Obama's other problem is that he will end up with a Congress that is dominated by Democrats. The Democrats have a long list of political allies to pay off. I doubt that Congress will let the budget get in the way. Senator Obama will not have the advantage that Bill Clinton had of having a Republican Congress who would pass no new spending programs.
superdestroyer, for his first two years in office had the advantage of a Democratic congress, not a Repubican one. Things changed. Things can change again. So if elected, Obama may find himself in the same situation as Clinton in two years.
It was George W Bush who cut taxes while waging two lengthy wars and creating the largest entitlement program since Medicare.
Why should I vote for another Republican?
Rico,
given the demographic changes in the U.S., the idea that the Republicans are going to make a come back is laughable. Besides the Republicans are probably going to be redistricted out of at least 30 seats in the House by 2012.
George,
that is why the U.S. is going to become a one party state. the country only needs one big spending, big government party. Karl Rove and President Bush thought that it needed two and they were dead wrong.
It the Republicans are going to have 20% approval ratings, the least they could have done is balance the budget but the idiot President Bush was too stupid to think that way.
But does anyone really know what the total amount of the deficit? Looks to me like the CBO, and the WH have been lying like crazy for the past 7 years, no? Why does no one mention the current account deficit? My understanding is that that could become the biggest problem of all. And how about just how bush has been financing his 2 wars. China and Saudi Arabia have purchased so much of our debt that one might say that these 2 countries will be able to force the US govt to do whatever they want.
Fixed.
If anyone cares, I wrote a blog post about this issue today.
That's 482 Billion, Joe, not Million. Muhahahahahahah!
-fixed thank you
> do I get editorial credit now? lol <
SD, demographics change for a reason. And IMO, the reason isn't ideology in most cases, it's their wallet and/or their sense of security. Security concerns are currently waning, wallet concerns are growing. Too many people feel like they're getting crowded out of the economy. And in that enviroment they aren't likely to think too kindly about the status quo.
That's basically what got Clinton elected (and just two years after Bush41's approval ratings were soaring as a result of the success of Gulf War 1). But people still weren't happy. So the GOP scored big gains two years later. In 2004 the GOP was talking about a “permanent majority”. Two years later they got their butts waxed. A lot can happen in two years. I'm not saying it will happen again, but it could. So if the Dems do sweep into power in 2008, they'd better be careful.
So much for having a Yalie with an MBA at the helm, LOL!
Ricorun,
As an addendum, I would say that it's not a forgone conclusion that certain demographics will always vote Republican or Democratic. The Democrats had to earn the respect of black voters by purging their party. The Republicans did the opposite.
“Of course, there is no real way that Senator Obama can cut taxes, increase spending, and make a dent in the budget deficit.”
It's okay, so long as enough people believe he can. Yes, We Can!
* * *
“Why does no one mention the current account deficit?”
What about unfunded future liabilities?
* * *
“Senator Obama's other problem is that he will end up with a Congress that is dominated by Democrats. The Democrats have a long list of political allies to pay off. I doubt that Congress will let the budget get in the way.”
Of course not. Once the Dems are in charge it will be back to “Don't believe the scary talk about the deficit”; “Deficit as a reasonable proportion of GDP is perfectly fine and in fact beneficial”; “it's just right-wing hype over the deficit myth,” etc.
What is worrisome is if the Dems get conceited over a large set of victories this November and want to lurch far to the left. We saw warnings about some of this with that laundry list of Michelle Obama's on another thread, recycling a program of creating all kinds of new benefits at the taxpayers' and business community's expense. This would be insane.
“So much for having a Yalie with an MBA at the helm, LOL!”
“Hazelwood George?”
Bush was supposed to run the government like a business. He kept his promise, running it just like the oil enterprise he ran into the ground in Texas before Big Daddy's friends bailed him out!
Did he run it like Halliburton?
By the way, K, Ted Stevens just got indicted on federal corruption charges. It seems the GOP hasn't learned from the 2006 elections yet. Don Young also is being investigated, and it could end up with yet another Democratic Senator after November (Ted Stevens — Another One Biges the Dust). This could be a slaughter of the GOP this year.
I saw, D. Uh it kind of makes the case for term limits that the GOP seemingly wanted back in the '90's.
I know we have an innocent until proven guilty system, but I honestly think anyone under indictment should give up their seat to focus on their criminal probes. How attentive could Stevens be to the business at hand in the Senate? Especially since he will automatically be kicked off the 3 committees he is a ranking member of.
It does look good for the Democrats, but I am no longer naive enough to believe that their victory will negate the influence-peddlers on Capitol Hill. The writers of “The Broken Branch” got it exactly right.
If Stevens or Young “have” to retire, they can always become lobbyists. [scowl]
“Of course, there is no real way that Senator Obama can cut taxes, increase spending, and make a dent in the budget deficit. “
Bush has already seen to it that the buck is passed, or more to the point 482 billion bucks. He started out with a surplus, and squandered his “political capital”.
What a horrible legacy he has left, a dog-poop laden footprint on America's tapestry.