When I recently posted an analytical news story, “The Claim that Barack Obama Is a Big Spender Is a Big Lie,” numerous conservatives countered by citing commentaries from conservative News sources, such as Eric Bolling of Fox News, and an editorial in Investor’s Business Daily.
Those commentaries featured headlines designed to attract conservatives, such as “Stop the Madness – the Truth about Obama and Our National Debt,” and “CBO Refutes Obama’s Slippery Spending Claims.” All of these commentaries equated deficits with spending, implying that the two are the same.
However, deficits and spending are very different from each other, and this will be seen with particular clarity if you will click on the well-documented Wikipedia article “History of the United States Public Debt,” at the end of which is an informative one-page table titled “Federal spending, federal debt, and GDP.” This table is the clearest summary of the U.S. fiscal situation for each year from 1977 to the latest that I have seen anywhere.
If you will look there at the latest reported year, 2010, you will see that the “Adjusted” “Federal Spending” declined 2.4% in that latest year, but that the “Federal Debt” soared by 12.5% in that year, which rise was unprecedented except for Ronald Reagan’s 15% in 1983, 12.3% in 1985, and 13.9% in 1986. By contrast, for example, the Federal Debt declined in Bill Clinton’s last year, 2000, when federal spending actually went up by 2.5%. (The largest annual increase in spending, incidentally, was Ronald Reagan’s 1985 figure, 7.4%.)
Why is there this enormous discrepancy between spending and deficit, such that they can even go in opposite directions? The reason is that deficits result not just from too much money going out (“big spending”), but from not enough money coming in (too little in taxes). Republican propaganda-vehicles (such as Fox News and IBD) hide this reality, and pretend that deficits result directly from “too much spending.” They do this so as to fool conservative voters into thinking that the fiscal problem is not too little in taxes but too much in spending. This deceit of the public enables these propaganda-vehicles and their very wealthy owners (their ultimate bosses) to block Obama from getting his proposed tax-hikes on $250,000+ annual earners (the top 2%) passed in Congress. It’s a self-interested deceit of the public by those owners.
All of this is acknowledged in policy-circles that are not themselves thoroughly corrupted by big money, but our craven News media have not pointed it out to their publics, because they don’t want to seem “partisan,” even if the facts in this matter are entirely “partisan.” Thus, this crucial reality, of the difference between federal spending and federal deficits, remains effectively hidden from the general public. (Of course, the News media on the political right are just propagandists, and so they don’t merely hide the difference; they actively pump the Republican lie on this, saying that more spending equals more deficits; they’re not passive about this lie at all.)
The other clearest summary statement I have seen of the situation (besides that Wikipedia table) was given by Greg Mallison in “Greg’s Monthly Commentary” at dwmwealth.com, in the document there “Greg Mallison’s February 2012 Budget Commentary.” He was writing there specifically about President Obama’s fiscal performance. Mallison said (and he included a graph to document) that, “While the federal government has largely held the line on spending in the last three years (believe it or not), the recovery in revenue has been dismal. Revenue peaked in April 2008 and then declined to 74% of that level in February 2010. It currently stands at 84% of the 2008 high. Already the deepest drop in federal revenues in history, in a few months it will become the longest – surpassing the four year duration of the previous record, the recession of 2001-03.”
Here is how Eric Bolling at Fox lied about this matter: He put up a visual that compared all eight years of George W. Bush and the three years thus far of Barack Obama, and he said: “Notice that the revenues for GWB and BHO are very close. The country has annual inflows (taxes, fees, licenses, etc.) that have remains [sic] stable between the two presidencies. Then the spotlight goes on.. It’s the spending numbers between the two presidents that are different.”
In other words, Bolling said that because revenues during Obama’s three years almost equaled the revenues during Bush’s eight years, but Obama spent far more than Bush did, “It’s the spending” that’s the problem with Obama – not the taxes. However, Bolling blatantly lied there by saying “The country has annual inflows (taxes, fees, licenses, etc.) that have remains stable between the two presidencies.” That’s not true according to any measure. Annual revenues during Obama have actually been lower than annual revenues under Bush, just as Mallison said. Furthermore, tax-refunds soared under Obama, because of the Bush crash, and therefore the net revenues to the Federal Government have been only a small fraction of the annual net revenues during Bush’s eight years. One of the charts in the Mallison article gives some idea of this revenue-plunge under Obama.
If one wants to see the full numerical details, they’re in the table, “Revenues, Outlays, Deficits, Surpluses, and Debt Held by the Public Since 1972,” which is page 132 in the full text of “The Budget and Economic Outlook: Fiscal Years 2012 to 2022,” (or http://www.cbo.gov/sites/default/files/cbofiles/attachments/01-31-2012_Outlook.pdf) from the Congressional Budget Office. You can see there that Bolling not only lied about the revenues, he also lied about the spending. Bush, in his eight years, spent lots more than did Obama in his three years, and so both aspects of Bolling’s visual were fraudulent. When Fox News needs to make things up in order to make their point, they do it; and they did it here. That’s how Republicans come to be deceived to think that Obama has been “a big spender.” The Republican News business is to deceive, because the facts are against them.
Media for more-sophisticated “liberal” or “high-end” audiences have more-sophisticated ways of deceiving about this. On 26 June 2012, huffingtonpost headlined “7 Misleading Things Obama Has Said in the Past 33 Days,” and Hunter Stuart listed as “Misleading Thing” “#1,” Obama’s statement that, “[Under my administration] government spending has risen at a slower rate than under any administration since Dwight Eisenhower.” Stuart cited, against that Obama allegation, Glenn Kessler, “The Fact Checker,” at the Washington Post, who, on 25 May 2012, said that, “Under Obama, ... federal spending as a percentage of the U.S. economy ... has hit highs not seen since the end of World War II,” partly as “the result of a sustained higher level of spending.”
But this statement was itself silly: How could these “highs” be anything else than a “higher level of spending”? That’s what they were, if they existed at all (which they did). So, they weren’t “the result” of those “highs,” such as Kessler said, they were those highs. Then, Kessler tried to seem like the phony objective “On the one hand, ... but on the other hand” type of person, by his saying, “Part of this, of course, is a consequence of the recession,” which was itself outright false: It was instead a response to the “recession.” For example, in Europe, spending is being cut while the depression rolls on. Their response to the depression is “austerity,” not spending (such as with Obama). An economic depression does not cause government spending to go up; that can – and there it does – go down. So, yet again, “The Fact Checker” was simply false.
But Hunter Stuart didn’t cite only “The Fact Checker.” He also cited a more blatantly prejudiced source, Daniel J. Mitchell, of the Republican magazine Forbes, and also of the Koch brothers’ Cato Institute.
Here’s the data-background to understand Mitchell’s lie: On page 27 in the “Fiscal Year 2013 Historical Tables Budget of the U.S. Government” is the “Summary of Receipts, Outlays and Surpluses or Deficits (-) in Current Dollars,” or inflation-adjusted figures. It shows that, “In Constant (FY 2005) Dollars,” the “Outlays” of the Federal Government fell -3%, from George W. Bush’s final budget-year of 2009, to Obama’s first budget-year of 2010, then rose +1.5% in 2011, then rose again +2.7% in 2012 (estimated). The Republican Forbes found a way to turn this favorable result for Obama around. Mitchell’s 24 May 2012 article, titled “Mirror, Mirror, on the Wall, Which President Is the Biggest Spender of All?” noted that, by his calculation, the inflation-adjusted annual figure for Obama thus far has been a paltry +1.8% average annual change in federal expenditures, and he acknowledged that ever since the time of LBJ, “Clinton was the most frugal president, followed by the first President Bush and [then] Obama.”
So, Mitchell started off there by noting that Obama ranked 3rd out of those 8 Presidents, on inflation-adjusted expenditures, according to Mitchell’s own calculation. But he evidently didn’t like this result. So, he went further, to jigger the figures in order to find Obama not to have been “frugal,” after all. Here’s how he achieved such Republican success: He re-calculated, and excluded federal spending for “Interest,” “Defense,” and “Bailouts.” And now, he said, that voila: “All of a sudden, Obama drops from second [best] to second-to-last” as being “frugal,” or: “In other words, Obama’s track record does show that he favors an expanding social welfare state,” since food stamps and other spending for the poor did rise significantly during the post-Bush depression, that’s to say during Obama’s Presidency. The Koch-funded Forbes columnist thus ended his piece triumphantly, by attacking Obama for spending more on the poor, in the wake of what is actually another Republican depression (but he didn’t note this; he ignored the “recession,” just like his billionaire patrons do; for such propagandists, there are no cycles, just up up and up, like any other Ponzi operator promotes as being the case). Mitchell concluded that Reagan was the most “frugal,” the least “profligate,” President, because Reagan spent by far the least on the poor. To them, that’s good.
It’s like this, one lie after another. All such blathering about federal expenditures, that’s without correlative discussion of the economic conditions of the country, and without any reference at all being made to the taxes that are coming into the government as the other side of those federal expenditures, isn’t really focused on reducing the debt, that’s just a pretense; it’s focused instead purely on sophistical argumentation to promote reducing federal taxes on the rich, and to reducing federal expenditures on the poor, just like Mitchell did in his piece, and just like Kessler did, too, when Kessler accused Obama by saying that “federal spending as a percentage of the U.S. economy ... has hit highs not seen since the end of World War II.”
Counter-cyclical increased spending is how a government actually constructively fights to overcome and end a depression, but this isn’t an objective that Republicans really want. The Republican argument is ultimately that the more wealth that accumulates in the hands of the rich, and the less wealth that goes to the poor, the more desperate the poor will be, and so the less that employers will need to pay in order to hire their workers. Republicans want to pay their “help” as little as possible. To them, that’s being “frugal.” Reagan was “frugal” (even though the debt actually soared under his watch). Reducing the federal debt isn’t of any real concern to them. It’s a mere rationalization, to sucker conservative fools to vote for their slimy conservative candidates.
Macroeconomics, otherwise known as Keynesian economics, says that at times like ours, when “revenues” or taxes plunge, the worst thing to do is to cut back on spending, because government needs then to step in and to supply the employment that businesses won’t, such as by repairing highways, bridges, and other infrastructure, and otherwise taking care of renovating the public assets that typically have deteriorated during good economic times when the private economy was providing sufficient demand to maintain full employment. Then, after people become re-employed and start receiving paychecks again, private businesses have customers again, and taxes into the government become restored again, so that the deficits and ultimately the debt come down. History shows that this actually works. It’s the constructive policy-response to the natural business-cycle.
Republican policy-wonks know that these things are true, but they cannot say that they’re true unless they are willing to jeopardize their own employment by the extremely wealthy individuals and those sponsors’ think-tanks and other propaganda-vehicles that constitute the system by which the Republican lie that “Obama is a big spender,” and that “Republicans are good for economic growth,” etc., become dinned into the heads of the deceived public.
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Investigative historian Eric Zuesse is the author, most recently, of They’re Not Even Close: The Democratic vs. Republican Economic Records, 1910-2010, and of CHRIST’S VENTRILOQUISTS: The Event that Created Christianity.
