[ August 31, 2012 by Jimmy Hogan ]
Awaking here from a long hibernation I've really just finally got my fill of how everyone seems to be giving President Obama a pass on spending. The latest myth is being advanced by Factcheck.org with a very deceptive graphic that by their own admission doesn't tell the whole story.
Here's the graph in question:
The graph shows a huge spike in spending in f/y 2009 and then spending more or less level after that. What it does not show is that there was a huge offsetting receivable from the TARP fund (Troubled Asset Relief Program) that was mostly repaid over f/y 2010 and f/y 2011.
In the text of the story they acknowledge that accounting for TARP would have affected the gross expenditures but they argue the effect would not have been substantial. They erroneously say "Actual outlays for TARP in fiscal 2009 totaled $154 billion" when the total outlays exceeded $400 Billion; but the $154 Billion figure as a net of outlays offset by repayments in f/y 2009 does seem correct. They also note that the expenditures in f/y 2010 and f/y 2011 are underrepresented by $108B and $39B respectively due to the offsetting TARP repayments.
Using their numbers I created the following chart that accounts the TARP adjustments and I added in Revenues also because the Payroll tax cut hurt revenues substantially too:
(click for larger image)
Now this still doesn't paint a pretty picture of Bush on spending but TARP stopped a run on the banks and has been almost entirely repaid with interest. What the graph does show is that the one time cost of TARP plus the stimulus spending has been used to establish a new baseline for spending. What should have happened is that the TARP repayments should have offset a large portion of the stimulus and then we should have returned, with recovery, to deficits in the $500B range instead of looking at $1.4Trillion dollar deficits into perpetuity.
As for FactCheck, their idea of President Obama being President Thrifty is ludicrous on face.
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