Posted on 02/05/2003 7:16:19 AM PST by Stand Watch Listen
On the left and on the right, it seems, we are hearing that President Bush´s $2.23 trillion budget will "swell the budget deficit to record levels," as Chuck Baldwin puts it. The Washington Post, in nearly identical language states the President´s "proposed $2.23 trillion budget for fiscal 2004 would significantly ramp up military and homeland defense spending, slash taxes in the near term and far into the future, and produce record budget deficits through the remainder of his term."
"Senate Minority Leader Tom Daschle said of the Bush Budget, "It's a budget-busting epic disaster. Today's budget confirms that President Bush is leading the most fiscally irresponsible administration in history."
"Democrats blame Bush's $1.35 trillion tax cut package in 2001 for much of the slide and say the $695 billion in new tax cuts he wants will only deepen the deficit hole."
Daschle´s statement is an invitation to inspect how Democrats addressed similar problems over the years. If, as Daschle and the Democrats claim, America is in a recession, what is the history of the policies of Democrat Presidents during economic downturns?
Let´s begin with the Great Depression that was underway when Franklin Delano Roosevelt entered the White House. In 1930, Herbert Hoover´s budget was $3.4 billion and the Federal Treasury received in total taxes $4.2 billion, and there was a budget surplus of $.8 billion, which was a 23.5% budget surplus.
Two years later after Roosevelt had been elected for the first time, which is comparable to Bush´s current situation, Roosevelt´s 1934 budget was $6.7 billion, almost double Hoover´s 1930 budget, but the Federal Treasury only received $3.1 billion in total taxes. While the tax receipts for 1934 had dropped by 25%, Roosevelt had doubled the budget expenditures so instead of having a surplus of 25%, the Roosevelt administration had a deficit for the year 1934 of $4.1 billion or a DEFICIT of 132%.
From 1934 to his death in 1944, not once did Franklin Delano Roosevelt ever balance an annual budget. By 1944, of course, Roosevelt was dealing with World War II. In 1944 the tax receipts due to the war tax increases for the year were $43.6 billion, ten times what they were in 1934. However, the budget had risen to $95 billion, which is 14.3 times more than it was in 1934.
This has been the spending pattern by Democrats fairly consistently for the past 70 years. With very few exceptions, when the Democrats controlled Congress, expenditures went up much faster than treasury receipts. From 1947-1949 and from 1953-1955 Republicans controlled the House of Representatives and federal spending was reduced. Republican Dwight D. Eisenhower was inaugurated in January 1952 and in 1956 not only did the Stock Market finally regain its values of October 1929, but once again there was a budget surplus. In 1956 with a Republican President and Republican House initiating the Budget, the nation spent $66.5 billion and the Treasury collected $68.2 billion, for a budget surplus of $1.7 billion or 2.6% of the budget. Twenty-six years before that, Hoover´s $.8 billion surplus was a whooping 23.5% of the budget!
For the year 2004, we have a Bush budget of $2.23 trillion and a proposed deficit of $304 billion. How does that, in real dollars, compare with the budget deficits of the Democrats in times of recession or war? President Bush, after all, has both. According to the Democrats there is a recession and the war on terror after 9-11. However, they still oppose Bush´s tough stance against Iraq that hopefully will disarm Saddam Hussein BEFORE he is able to destroy entire American cities.
If there were a $304 billion deficit in the $2.23 trillion budget the percentage the 2004 Budget deficit will be 13.6%. During the entire 12 years of Roosevelt´s administration he NEVER brought the budget that low! The closest he ever came to getting the deficit that low was a 17% deficit in 1938, when supposedly the Depression was "over" and war had not started in Europe. In 1943, at the height of World War II, Roosevelt spent three times the money that was raised in taxes. He spent $79.4 billion and the treasury received $22 billion. That would be the equivalent of George W. Bush increasing his budget from $2.3 trillion to $7.81 trillion dollars.
Bush´s 2003 budget is designed to strengthen the economy, win the war on terrorism, PLUS expand Medicare to provide prescription drugs for seniors, and invest $1.7 billion for research in hydrogen fuel that would both improve the environment and eliminate our dependence on Middle East oil. By strengthening the economy, it is also expected that more taxes will be collected.
In 1994, when Bill Clinton had been in office for 2 years, before the Republicans gained control of the House, and with the help of a Democrat Congress in a period of rising prosperity, no recession and no war, the budget expenditures were $1,460,553 and the treasury collected $1,257,451. That works out to be a 16% deficit for the Clinton 1994 budget. After the Great Budget Battle of 1995 with the Republican Controlled House of Representatives reducing the increase in federal spending, by 1997, after five years of Clinton fighting with the Republicans in Congress, the budget deficit had dropped to 13.7%, a larger deficit than Bush´s budget projection to fight the war on terror AND recession.
The year 1997, you will remember, was the year we ended up somehow in the great "Clinton" economic boom.
I know I say this frequently, but I just can´t figure out how Tom Daschle and so many media people read the same figures that were hailed as indicative of a marvelous economic boom under Clinton as indicative of "a budget-busting epic disaster" or "record-breaking deficit spending" under George W. Bush.
Tell me: Am I the only news analyst in America with a calculator?
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