When it comes to most of the major political disputes in Washington, congressional Republicans insist Democrats focus on reducing the debt Republicans built up during the Bush/Cheney era. It underpins everything from the budget fight to the debt ceiling to efforts to expand public investments.
What the debate tends to ignore is the debt reduction that's already happened. Michael Linden and Michael Ettlinger reported yesterday that since the start of 2011 fiscal year, President Barack Obama "has signed into law approximately $2.4 trillion of deficit reduction" over the next decade. Their Center for American Progress report came with this terrific chart.
Roughly three-quarters of the deficit reduction has come is in the form of spending cuts, which should further make Republicans happy. And while the $2.4 trillion in savings will be spread out over the next 10 years, it's also worth noting that the deficit has shrunk by $300 billion in Obama's first term, and we're in the midst of the fastest deficit reduction since the end of World War II.
To be sure, it would be my strong preference that policymakers not make this a priority at all. What the nation needs is jobs and economic growth, and the most sensible course of action would be to delay fiscal concerns for a later day. In the wake of a brutal economic collapse, when the need for investment is high and interest rates are low, the responsible thing to do is borrow more, not less.
But even if we put that aside for a moment, the CAP report points to a reality that generally goes overlooked, even by a political establishment that's needlessly obsessed with conservative assumptions about fiscal responsibility.
The conventional wisdom suggests nothing is being done to address a perceived debt "crisis," and that somehow Republicans have the high ground in demanding more and more cuts. It seems spectacularly insane to me to think the GOP has credibility on the subject given that it was Republicans who created the budget shortfall in the first place, but establishment assumptions are hard to shake.
But that's what makes the Linden/Ettlinger report so worthwhile: something is being done, whether this deserves to be a priority or not. Obama has already approved $2.4 trillion in debt reduction. If we include the savings from sequestration, which still need to be negotiated, it would boost the total to $3.6 trillion in debt reduction over the next decade. If we include the savings from the Affordable Care Act, we're looking at roughly $3.8 trillion in debt reduction over the next decade.
That's awfully close to Grand-Bargain-style debt reduction, without actually striking a Grand Bargain.
What's more, let's also not forget cost-saving measures Obama proposed -- cap and trade, Dream Act -- and the GOP killed.
DC assumptions notwithstanding, those who are eager to see Washington push the budget closer to balance should be thrilled by the progress of the last few years.
Postscript: Just as an aside, let's also take a moment to compare administrations. Obama, in just the last two years, has accepted $2.4 trillion in debt reduction through multiple proposals. How many debt-reduction proposals did Republicans approve during the Bush/Cheney era? None. Even when there was a Republican-led House, Republican-led Senate, and Republican-led White House? Yep, even then.
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Whew, this Republican Brand is wearing me out with their insistence on failed economic policies!
Say, a few future presidencies have passed by. What will the Republican Brand (1980 - 2012) look like having two Democratic Administrations with credible economic policies abutting deficit bursting, ponzi eonomic scheme, Republican supply-side economic policies?
The Village Press need to stop framing our nation's economic woes as a political football game and hone in on the results of the economics behind the political arguments!
But, alas, I ask for too much! -Kevo
The republicans in office are only in it for their rich ass self's that and being racist might also be why they are against Obama. Things that make you go hmmmmm
And yet...they whine. I just saw Tom Cotton AR on Chuck Todd. He was like a little robot spewing talking points that are just not true...especially given this chart. He also threw around 'far left' attacks...when he just has no idea. It's scary how programmed these congresscritters are.
Anybody see the latest Staples TV ad that was just something to see. Here they got a worker taking his daughters office supplies and household toilet paper to work. Considering Romney is an owner of staples and about the cheapest bastard around. That would be exactly like Romney to make his workers bring their own office supplies and toilet paper to work. With Romney that would be need to go to the bathroom, you had better hold it or have your own arse wipe in hand. And of course, a major financial fee at the bathroom door in order to get in. Either have money in hand or bring a pail to work with you. Perhaps also some kind of canopy for a little privacy while you do your duty.
Given that the "Platinum Coin" has caused such a kerfluffle, perhaps Obama should propose some specific 'debt reduction cuts'.
Close Ft. Benning (GA).
Close Ft. Hood (TX).
Close Ft. Knox (KY).
And a few other government money pits in Red States. That should get their attention, pretty quick!
Not to mention I don't think anyone would be comfortable with large stockpiles of arms and equipment that close to that many crazy people...It seems like they all congregate south of the Mason/Dixon line...must be something in the water
Guys, guys, guys. You think it's a coincidence the base closing commission left the major army bases in the states with largest numbers of gun-hoarding pig-ignorant insurrectionist wannabes? Why on Earth would we want to move them out?
The goal need not be to actually close them but to make Repugnicons cry about keeping them open. That said, I'm not all so sure it does more than satisfy an itch.
and maybe thats why President Obama and the Democrats know this and well have met the reduction part, so now its on to revenue gaining.
gee I know it was Mitt and it was the first debate, However, i did agree 100% when he said he one of the ways to raise revenue by raising workers wages. smiling yes i know, shocking huh.
Not just shocking, but ironic as well!
Mr.Benen republicans do'nt believe we need more jobs. They believe that if a family of four with an income of ,oh lets say 40k per year loses their income due to job loss or other crisis. They do'nt need to find another job to bring in revenue, all they have to do is cut their spending. Prices rise just cut spending someone gets sick just cut more spending. So why all the talk of jobs when we do'nt really need'em? If they just keep cutting spending they'll never run out of money.
Can our country consider the Republican Congress persons suggestion to Mint a trillion dollar coin to pay bills if the country defaults, also as a way to pay our debt to China? Could the United States make trillion-dollar coins payable to China from only the World Bank less the assessed 25% to 30% trade currency manipulation for each year of our debt to China since 2005?
Can we, and other nations, develop International Law through the World Bank that would support such a monetary transition to protect the world economy and each nations economy from such practices that have damaged our economies? Such as, legislation making the debt void if China refuses to accept the managed payment.
The world economy, and each of our national economies, must protect their selves from other nations, such as Indonesia and Vietnam, causing the same price, wage, business and job loss that China’s practices has created.
My suggestion to curb such trade imbalance, would be for our nation, and other nations, to only offer Free Trade with countries that have an established Minimum Wage, with a wage of no less than half of each countries own Federal Minimum Wage. (We could choose to exempt the poorest nations in Africa from the wage policy, to help encourage the business development of Africa’s economy, but their workers would not like us for it.)
The money from the new Minimum Wages trade policy and/or Tariffs’ from countries that do not qualify, would create the prices of products for trading countries more on a competitive equal price range and improve each nation’s economy. At the same time, we would support decent wages around the world.
Can you add to these proposed ideas or would you contact administration officials and support these ideas?
Considering China only owns about 8% of our debt, why should we focus solely on them? And how exactly does the USA mint coin payable only by the world bank?
I agree we've become more a plutocracy than a republic, but how exactly do you suppose law is developed "through" a bank?
There are several reasons for jobs moving to China and few of them have to do with China's policies.
Every time I hear a repub open his yap about spending cuts, it always comes down to "entitlements"--Medicare, Medicaid and Social Security. "Just cut them and our problems are solved", they all say. Not a penny from the Pentagon, which in their eyes has apparently done a stellar job of spending their trillions without waste and fraud. My question to them is "What happens to the poor, the sick, the elderly, when you cut those programs? Those people don't go away, their problems don't go away. They are still poor, they are still sick, they are still elderly". They act as though cutting Social Security is no different than cutting a few airplanes from the defense budget. There is a massive difference between deciding not to purchase something in the budget, and cutting funds that deal with an existing and ongoing problem or issue. I think people from both sides will agree that healthcare is our number one spending issue, and yet the one big step we've taken to reduce healthcare spending, to the tune of a trillion dollars over the next decade, Obamacare, is the one thing repubs want to repeal. We have the most expensive healthcare system in the world, and yet it does not produce the best outcomes....we come in just ahead of Cuba in global rankings, and well below every other advanced nation. I would think that repubs would be screaming to reform such an inefficient and costly system. But that would mean that their objections to healthcare spending are based on facts and principle. Clearly, they are not. They are there, as usual, to make the rich richer, like Big Pharma, and if that means screwing the citizens of this nation, they couldn't care less.
The Social Security Benefit Fund had over a 2 trillion-dollar surplus according to a government official interviewed by PBS News Hour Anchor, Judy Woodruff about a month ago. (Realize that the entire nation pays 2 to 4 trillion dollars in Federal Taxes a year, when contemplating that surplus.)
Are both major parties just making the baby boomers retirement a political issue or are our leaders really thinking there will not be enough money when they retire when the fund has such a surplus in this stressed economy? Maybe we really need an Independent Presidential Candidate to investigate and make sure that both major parties are not going to borrow from, or dip into, our benefit fund to pay the debt. (Perhaps the informed man Ms. Woodruff interviewed would make a good Presidential Candidate.)
Medicare is a separate fund. Medicare costs doubled from 2005 to 2006 when the 2005 Republican House approved the Prescription Medicare Part D plan that Republican leaders have dubbed successful. (More like, ‘successful’ for drug manufacturers and pharmaceutical corporations and successful at driving Medicare under from a Republican leadership that wanted to run the program over while collecting from corporate contributors at the same time.)
Medicaid is a State managed fund, with the Federal Government paying one part of every four dollars the States spend, if I recall correctly.
I say we should give the Affordable Care Act a chance, and make changes if need be as the years go on.
Uffdaguy, I agree. So, if $2.4 Trillion in cuts have already been made, and if the Cliff agreement only garnered $600 Billion in Revenue generation, and if we go along with the Republican requirement to go $1 in cuts for every dollar of revenue, doesn't that mean the Republicans need to come up with $1.8 Trillion in cuts by say, closing the tax loopholes for the wealthy they said would take care of the problem and the elimimnation of programs/allocations of programs the DOD doesn't want. That would be fair and balanced, right?
"The head in the sand, alternative universe formula has proven at last to be an utter failure. ... The Republican Party is now relegated to catch up role. While time marches on, the sooner the Republicans come to grips the better off we all are. America needs two strong national parties, if for no other reason than each to keep the other honest and in check, not permitting the more powerful of the two to slide toward despotic rule. The Republican Party must learn to increase the size of the tent. In the process it must transform itself."
How do we effectively become Somebody Else? Read more at
http://lifeamongtheordinary.blogspot.com/2012/12/somebody-else.html
I have no idea what that chart means.
"Debt" and "deficit" are not interchangeable. Deficit is year to year. Debt is accumulative. Reducing the deficit by $300B did not reduce the debt. Any deficit at all continues to add to the debt. $2.4T in savings works out to $240B less in spending per year over 10 years. The deficit, however, is still close to $1T per year. That means that the debt will increase more slowly, but it's not decreasing. I'm not saying I disagree with you about realtive unimportance of our current debt situation, just that we'll never reduce our debt until we eliminate our deficit.
Mr. Benen is a very smart individual, yet he seems to use the terms you mention (debt and deficit) interchangeably in the above article. If the debt continues to climb, then there has been NO debt reduction.
If the deficit is shrinking, then the rate of debt would seem to decrease as well, but the debt itself has NOT been reduced. I would love to see Mr. Benen address the use of debt and deficit in the above article. We'll see...
I was wondering how long I'd have to read before someone would mention this glaring defect in the article.
Yes, but James, notice how many other ignore that FACT because the content of the article matches their political leaning. This happens on both sides, liberal and conservatives alike. I find it entertaining but a little depressing as well. I'm sure I'm guilty of the same behavior, too. Hopefully, when pointed out, we can learn to be open enough to see truth if not at least the "other side's" point. Oh, well.
Sadly, it was Lyndon Johnson who provided the inspiration for the Bush War Debt. His "guns and butter" approach to the Vietnam war was an earlier attempt to wage war while maintaining a peacetime level of sacrifice for the American people at home. His disinclination to raise taxes OR borrow money meant the printing presses hummed, and we had record inflation the next ten years. Bush multiplied this foolishness by cutting taxes and going to war on borrowed money. This had never happened, ever, anywhere, and stands as a tribute to the confidence in Treasury Bills, and the worldwide pool of money seeking safe investment.
Bah! Those cuts don't count. The only cuts that count are cuts that inflict actual suffering on the poor and middle class and there just hasn't been enough of it. Our Galtian overlords don't want to hurt the little people, heaven knows, but alas, that suffering is essential for their moral improvement and it only through that moral improvement that the great moral problem of the Deficit can truly be addressed. Only when the middle class is reduced to homeless, sack cloth wearing peonage will the cuts be sufficient.
you know Steve hit the nail on the head when Shooter doesn't blather on!
The moire the electorate understands the issues and need for cutting spending, and the effects on the poor and middle class, the better it is for them to understand what we need; jobs, jobs, jobs. The question to ?congressinal delegates need to be, "Where is your jobs, plan?" because that is the only way we'lk get uyt of this mess that Bush 43 and Compsany got us into, and the Congress since 2010 has not put up one signle effort, except to go the austerity route that got Greece to go down the tubes, but the EU wised up and began correctly, the grwoth mode.
Dudes, the word deficit does not appear in the above post of Mr. Benen's. I agree that debt and deficit are elsewhere often confused, and would suggest "this year's revenue shortfall" instead of deficit. The debt keeps growing and so merits a larger name, so how about "money Congress borrowed to pay for Stuff that We The People Wanted".
Keeping Track...you need to do better "tracking" because the word "deficit" appears multiple times "in the above post of Mr. Benen's."
And why call it "this year's revenue shortfall" instead of "this year's over spending?"
Not that the rising national debt is a good thing but everyone knows we are currently borrowing at a negative interest rate right? In other words we are actually earning interest on what we borrow not the other way around. (That would change on a default ) So, the comment above is probably right. Cut spending but not if spending cuts are at the cost of jobs and economic growth. If we get everyone working again, and taxed again, we have more revenue to pay down the debt. It needs to be done in responsible steps.
Sure glad we’re saving all of this money. Someone needs to tell the national debt clock to run in the other direction. http://zfacts.com/p/461.html
Even if the repubs hold their principles and no new spending is passed, we are over $1T annual deficits now -- and that's assuming the bond market stays at the same levels it has been (0.3% short term) (historically, that's impossible). So when bond rates rise, the carry cost on the debt explodes. We go to $2, $2.5T+ without doing a thing. And all of those number are independent of ObaMa care, the SS Ponzi scheme, or any other regulation that keeps or increases the wet blanket on the economy. Net-net: Republicans can block everything and the situation still rapidly gets fiscally worse at an ever accelerating rate.
Republicans are only interested in deficit reduction when Democrats are in charge and they can play the blame game to its fullest. If the Democrats don't lower the deficit, they'll blame Democrats for fiscally irresponsible. If Democrats do lower the deficit, they'll blame Democrats for all the pain that causes.
Bit right now, they're getting the worst of both worlds. Democrats are lowering the deficit without causing any pain. So, obviously, the GOP will choose to do nothing and let the sequester happen, thus causing pain, for which they will blame Obama.