In the book Pawlenty bemoans big spending on President Barack Obama’s watch.
“President Obama has overseen the first two budgets with trillion-dollar deficits in American history,” he wrote on page 266. “He has racked up more debt than every President from Washington to Reagan combined.”
On the surface, Pawlenty’s claim is correct. But it implies that Obama is solely responsible for runaway spending. In fact, the deficit had already exceeded $1 trillion before the president took office.
According to the Congressional Budget Office (CBO), the deficit was $1.4 trillion in fiscal year 2009 and $1.3 trillion fiscal year 2010 – the first trillion dollar deficits in history, as Pawlenty correctly points out. (Because these figures are not adjusted for inflation, economists tend to compare deficits as percentage of gross domestic product. By that measure, the largest deficit in history occurred in 1943.)
He’s also correct that more has been added to the national debt during the Obama administration than “every President from Washington to Reagan combined.” When Reagan left office, the national debt was $2.190 trillion, according to CBO. During the first two years of the Obama administration, roughly $3 trillion has been added to the national debt, according to the Treasury Department.
But as is often the case with the federal budget, this story is more complicated than it seems.
Budget crunchers think in terms of fiscal years, which begin on Oct. 1 and end on Sept. 30. So a sizeable chunk of new spending in Obama’s first year was the result of big-ticket items passed by a Democratic-controlled Congress and signed by President George W. Bush.
Almost half the spending increase – about $245 billion – stemmed from the Troubled Asset Relief Program (TARP) and payments to Fannie Mae and Freddie Mac. Further, revenue declined 17 percent between fiscal years 2008 and 2009 as a result of the recession. That added to the deficit– defined as the difference between the money the federal government takes in and the amount of money it spends each year.
In fact, before Obama took office on Jan. 20, 2009, CBO had already estimated that the 2009 deficit would be at least $1.2 trillion.
But Obama isn’t off the hook. Another $200 billion was added to the deficit as result of the spending in the stimulus bill, one of Obama’s first major legislative efforts.
This PoliGraph test is misleading.
It’s true that Obama’s first two years in office were marked by trillion dollar deficits and debt. However, it’s misleading for Pawlenty to pin blame on Obama when, in fact, Obama inherited big spending increases and massive revenue shortfalls from his predecessor.
The Center on Budget and Policy Priorities, Policy Basics: Deficits, Debt, and Interest, accessed Jan. 22, 2010
Bloomberg News, U.S. Deficit for 2009 Totals $1.4 Trillion, Budget Office Says, By Brian Faler and Julianna Goldman, Oct. 8, 2009
The Congressional Budget Office, Monthly Budget Review: Fiscal Year 2009, Nov. 6, 2009
The Congressional Budget Office, Revenues, Outlays, Deficits, Surpluses, and Debt Held by the Public,1970 to 2009, in Billions of Dollars, January 2010
The Congressional Budget Office, Monthly Budget Review: Fiscal Year 2009, Oct. 7, 2009
The Congressional Budget Office, Monthly Budget Review: Fiscal Year 2010, Oct. 7, 2010
The Congressional Budget Office, The Budget and Economic Outlook: Fiscal Years 2009 to 2019, Jan. 7, 2009
The Cato Institute, Don’t Blame Obama for Bush’s 2009 Deficit, by Daniel J. Mitchell, Nov. 19, 2009
The Treasury Department, The Debt to the Penny and Who Holds It, accessed Jan. 22, 2010
Interview, Alex Conant, spokesman, Gov. Tim Pawlenty, Jan. 20, 2010
Interview, Jim Horney, Director of Federal Fiscal Policy, Center on Budget and Policy Priorities, Jan. 23, 2011
Interview, Daniel Mitchell, Senior Fellow, Cato Institute, Jan. 23, 2010
The Humphrey School