Dan Mitchell on spending by US Presidents

Dan Mitchell from DC recently graced our shores with appearances at One Nation and Libertyworks in Brisbane and The Outsiders in Sydney followed by lunch and photo opportunities at Middle Head and then off to New Zealand.

He has studied the spending records of presidents from LBJ and Nixon to the Bush family and Barack Obama. The results are interesting and possibly surprising. Congress stood in the way of Obama’s spending for most of his time and so he ends up looking better than several others on that score. Not a big plus in his favour of course.

It is important to recognize that Obama did not stop trying to expand government after 2010. The president’s eight annual budget requests gradually upped their 10-year revenue demands from $1.3 trillion to $3.4 trillion, while proposing an average of $1.0 trillion in new program spending over the next decade. His play, in short, was to gradually trim the budget deficit by chasing large spending increases with even larger tax increases. The Republican Congress stopped him. My assessment: Obama’s most important fiscal legacy was a sin of omission. Despite promising to confront Social Security and Medicare’s unsustainable deficits, the president refused to endorse any plan that would come close to achieving solvency. This surrendered eight crucial years of baby-boomer retirements while costs accelerated. With baby boomers retiring and a national debt projected to exceed $90 trillion within 30 years, this was no small surrender.

This entry was posted in American politics, Rafe. Bookmark the permalink.

6 Responses to Dan Mitchell on spending by US Presidents

  1. Rob MW

    So how did uncle Barry manage to double the debt in just 8 years when it took a couple of hundred years to arrive at the debt just prior to uncle Barry getting elected. Obviously poor Barry must have spent something, like maybe $10 billion more than taxes received.

  2. Rob MW

    Opps – that should be $10 Trillion more……

    Something like $10,000,000,000,000.00

  3. Gavin R Putland

    The fiscal record of any government or branch of government is primarily determined by the phase of the economic cycle at which it holds power.

    I do not deny that there are differences in policy. I do not deny that in America, you can spin those differences either way by choosing to focus on the party controlling the White House or the party controlling Congress. I do not deny that in Australia, you can spin them either way by choosing to focus on the Government or the Cross-Benchers. But, as these policy differences are not of such magnitude as to be capable of arresting the economic cycle, they are dust in the balance compared with the cycle itself.

  4. Zatara

    His play, in short, was to gradually trim the budget deficit by chasing large spending increases with even larger tax increases. The Republican Congress stopped him.

    No, they didn’t stop him at all. While the Congress didn’t pass a single budget of his in any of the 8 years of his presidency they did write him blanks checks annually by passing ‘continuing resolutions’ which allowed him to spend as much as he wanted on whatever he wanted.

    Congress failed to apply the discipline of passing budgets and Obama went wild. Just as the Dems planned it.

  5. Entropy

    But, as these policy differences are not of such magnitude as to be capable of arresting the economic

    Maybe to an extent, Gavin. Yet government expenditures here continued to rise strongly long after the ephemeral (for this country) effects of the GFC were long past. In fact, maybe these record levels of expenditure, and the quest to find ever new ways of spending it, are the cause of the malaise. But that theory would not be accepted by those public servants who believe they control the economy.

  6. Harald

    In the American system the Congress holds the purse strings – specifically the House of Reps. Any and all US federal spending originates in the House of Reps.

    Comparing spending records of US Presidents is akin to comparing the average UK’s spending records racked up during the reigns of the different Queens/Kings of England. 🙂

    To make sense of it one has to study spending as a function of a Democrat held vs. Republican held House or Reps first and foremost, and to some degree also the Senate.

    The president I guess only really matters if he’s either very popular and well liked, or one party controls all three branches and they work together well – the opposite of what’s happening now as the US congress is united to make sure Trump does *not* get what he wants.

    Clinton, for example, had low deficits and was the last president to see a surplus during his term in office. The credit, of course, does not go to Clinton, but instead to Gingrich who was Speaker of the House. The fact that Clinton almost balanced the books, was entirely the achievement of Newt.

Leave a Reply

Your email address will not be published. Required fields are marked *