Solution to Fiscal Clift: Look No Furhter than Obama's First Term

opinion | 11/14/2012 | annajones

[annajones]

Pundits, Politicians, etc are looking all over the map for a solution to the fiscal clift/sequestration problem.

But the solution lies in what happened during Obama's first term.

Under Bush/Congress the deficit increased 43% during his 8 year term (we had a real war, 9/11, and Katrina).

Under Obama/Congress the deficit "doubled" during his 4 year term or "half" the time.

Rather then us having to listen to threats to cut Social Security, Defense, or severe increase in Taxes shouldn't we go back to the problem that caused this Sequestration legislation to be passed in the first place?

Should the solution to the deficit problem be found by examining what this administrations first term did?

[annajones]

The fact was that under Bush/Congress the deficit went up 43% during his 8 year term. Given we had a "real" war (complete with bombs, 9/11, and Katrina. Obama didn't have that in his first term).

Under the Obama first term Obama/Congress the deficit went up "double" what Bush did during Obamas four year term (that's "half" the time!!).

Should the solution to the deficit problem be found by examining what this administrations first term did? We now have the same President, pretty much the same Senators, and somewhat the same Congress. Obama's first two years had a democrat controlled House. Meaning the current House is only "part" of the problem. It was during this new or current Congress that they called for this Sequestration deal which Obama signed. Legislation that resulted because the deficit has run away. The problem to the deficit lies in "what" was done during those first 4 years.

I'm not convinced that Social Security spending changed it or that Defense spending changed it. It's also a fact (Panetta echos it too) that the defense spending has already been cut half a trillion. No other programs have been cut according to input I got from another member. Ref. post 20 from

http://www.freerepublic.com/focus/f-news/2959146/posts

We had Obama run during his first term complaining incessantly about Bush but when it comes to spending the Bush administration was more responsible. It's also interesting to note that Obama is calling for the Bush tax cuts to be extended as if it's a good thing. So much for criticizing his predecessor.

[dynachrome]

ummm. try again with better spelling in the title. (and believe me, I have hosed up posting before)

[dead]

[pepsionice]

You have three simple events which have all come to meet at roughly the same time.

First, for forty years...the government has continued to grow at a fairly healthy scale. In 1950....we had around 1.44 million government employees. As of 2009, we had 2.1 million. Figure the salary structure, the benefits, and the pension for each one. Not only do they have some job to perform, but in most cases...they have to spend a fair amount of money in the performance of their job. We’ve kinda maxed out here.

Second, since the 1980s...we’ve been exporting jobs and business outside of the US. We actually got around to downsizing the dollar (part of Bush’s efforts) in order to drum up business for America. The cost of manufacture in America is ridiculous...but we play out this cheap-dollar routine to survive. We’ve maxed out on this strategy.

Third and final...when the housing market collapsed in 2008...everyone got this idea that we were going to stabilize and recover. Basically...empty houses remain, and the banks are sitting there on a ton of houses or worried home-owners who really can’t afford the current mortgage they are stuck with. Recovery in the heartland of America has yet to occur.

All that the President does...is simply stir the pot with words. There’s nothing with recovery here. It’s like coming up on a car accident....it’s best to look at it from a distance and just keep driving. Stopping won’t do much good.

[Oldeconomybuyer]

Eleanor wears comfortable shoes. This makes her superior to the typical idiot.

[dynachrome]

yeah, I’ve posted in that condition before! haha.

[DonaldC]

Mark to read later.

[annajones]

I still want to know why the deficit “doubled” to an amount greater than all his predecessors. Was it bailouts? Was it changes to entitlements? Was it giving money away to prop up third world countries? The war efforts under Obama don’t even come near to what happened durding Bush’s term so why so much money spent? Should we find out what was done and what of those items should be cut? Is it more a spending problem than a revenue problem? Our federal government should have the money and the staff to do such research or perhaps the research is already there. I think the American people have a right to know what happened. Like Obama or the current government or not depend on answers to such issues. What was the spending and was it a good decision?

[rfp1234]

“Look no fuhrer than Obama’s first term”. That’ll work :-P

[ccfromsc]

Very Good topic and posts!

I see it as failed Keynsian economics. Just keep throwing out money to prop up and build up an economy is in itself creating an artificial economy which is a “bubble” that will burst when the money fails to produce a true consumer business cycle.

Spending money bailing out GM was not good. Not the way it was done. The Chevy Volt is a disaster. Solandra solar fiasco was another. The problem is emblematic that you have intellectual socialist at the helm doing what they think “business” needs rather than get a businessman that knows what to do.

[rfp1234]

Here's a scenario. Zero may pretend to triangulate, and eventually drop his demand to 'soak' the 250k + incomes just before the fiscal cliff deadline. He'll propose a 40% bracket for $1 million and above, and cut the corporate tax rate to 25%.

In exchange, Boehner & McConnell will agree to support amnesty, a carbon tax, and allowing Obamacare to go forward with minor tweaks. I hope I'm wronger than Dick Morris on this but it could happen.

[Alberta's Child]

One of the things that drove the increase in spending was the first wave of Baby Boomer retirements. Social Security and Medicare outlays are spiraling out of control.

Another thing has been the growth of Social Security Disability Insurance claims in the last few years. It's no secret that many middle-aged people who are part of the long-term unemployed and may never work again are using SSDI as a source of income once their unemployment benefits expire.

[annajones]

I read r/e Baby boomers that their birth rates were significant enough to generate another set of boomers. However it’s unknown how well employed this next generation is. In the old days Social Security Disability isn’t easy to get. I heard they changed the rules to make it easier. That is what I heard.