1The debt burden has gone down ... · 29.You're wrong... the public debt was 43 percent under Clinton and 36 percent under Bush.... ... blame Clinton for the high level of debt that existed when he took office?
That's an excellent point and it needs to be borne in mind, but the real "apples and oranges" problem here is the mix of politics and economics.
Then again, we need all four to eat, so we do the best we can. IMHO the Wash Times article muddled the two a bit, but but let's focus on this concept of debt burden. I pointed out that it's lower now. You pointed out that the debt burden is increasing now while it was falling before. Let's get comfortable with the fact that we're both right-- neither of us is "wrong".
Our concept of debt burden is the amount of the debt and the size of the economy and of our wealth. The graphed averages in post 1 show how the size of the economy can make irrelevant the effect of fiscal policy. Average deficit increased while average debt decreased.
An exclusive concentration on fiscal policy says that it's impossible for the debt to decrease with a period of increasing deficits. Yet it happened. The key to understanding the situation is economic growth. That's why I was excited about the comment in the article on how "the economy is growing much faster than expected."
The debt burden has gone down over the past decade even though revenue dropped more than spending. The reason is that the economy grew so much. I pointed out that it's lower now. You pointed out that the debt burden is increasing now while it was falling before. Let's get comfortable with the fact that we're both right-- neither of us is "wrong".
I agree that, if you look at the entire decade, there is an argument that your statement is technically correct. From 1994 to 2004, both the gross federal debt and the public debt increased in current dollars (the numbers can be seen at http://home.att.net/~rdavis2/debt06.html). However, both decreased as a percentage of GDP. The reason is that the GDP continued to grow under both Clinton and Bush.
However, the Clinton and Bush periods are so disparate, it presents a misleading (or at least incomplete) picture to combine them. Under Clinton, the debt burden went down, chiefly because, as a percentage of GDP, revenues went up and outlays went down. Under Bush, however, the debt burden went UP, chiefly because, as a percentage of GDP, revenues went DOWN and outlays went UP. During this entire period there was also the ever-present shrinking of debt burden due to growth in GDP. However, there was also the ever-present cost of the debt, the portion of the budget that goes to pay nothing but the interest on the debt. Hence, the debt burden is not a costless entity that is steadily shrunk down to zero through GDP growth. We pay an ongoing cost for it.
What is most misleading, however, is your chart in post #1. An unsuspecting reader would likely think that the shrinking average debt burden was somehow connected to the lower revenues. In fact, it is connected to the fact that the debt burden declined under Clinton. This insured that Clinton's average debt burden was greater than his final debt burden, the one that he passed on to Bush. Hence, your method of displaying the data perversely uses Clinton's (and the Republican Congress') virtue of decreasing the debt burden against them and rewards the fruits of that virtue to Bush and our current spendthrift Congress. I make no judgment about your intentions in posting it up until now. That will continue to be the case if you stop posting that particular chart. It's your choice, of course.
