Deficits matter!on August 24th, 2009 at 3:25 pm
Shortly after the April 15 Tea Parties were held all over the US, “comedienne” Janeane Garafalo made news when she insisted that the protests were not about spending…”this is about hating a black man in the White House. This is racism straight up.”
She reasoned that because there were no tea parties protesting the out-of-control spending by the Bush administration, there could be no other reason for the April 15 protests besides racism.
Well, here’s a piece of news from Harvard Economics Professor Greg Mankiw that explains what got everyone so worked up:
Before you read this story, here is one number you need to know: the U.S. federal government’s debt is now about $7.4 trillion. That is the accumulation from past budget deficits.
With that number firmly in mind, here is a story from the Washington Post about the path of future fiscal policy:
The nation would be forced to borrow more than $9 trillion over the next decade under President Obama’s policies, the White House acknowledged late Friday, bringing their long-term budget forecast in line with independent estimates.
The new projections add approximately $2 trillion to budget deficits through 2019. Earlier this year, the administration had predicted that Obama’s policies would require the government to spend $7.108 trillion more than it collects in tax revenue over the next decade.
An administration official, speaking on the condition of anonymity because the report will not be formally released until Tuesday, said the change is due primarily to updated projections of economic growth that are far less rosy than data used when the White House released its first long-term budget outlook in February.
So… in ten years the new Administration will add more to the accumulated budget deficits than all previous budgets combined?
That’s change alright.