Obama's New Year's Resolution: The US Economy goes on a diet

[I AM NOT THAT GUY 5,715]

After spending binge, White House says it will focus on deficits

President Barack Obama plans to announce in next year's State of the Union address that he wants to focus extensively on cutting the federal deficit in 2010 – and will downplay other new domestic spending beyond jobs programs, according to top aides involved in the planning.

The president's plan, which the officials said was under discussion before this month’s Democratic election setbacks, represents both a practical and a political calculation by this White House.

On the practical side, Obama has spent more money on new programs in nine months than Bill Clinton did in eight years, pushing the annual deficit to $1.4 trillion. This leaves little room for big spending initiatives.

On the political side, Obama can help moderate Democrats avoid some tough votes in an election year and, perhaps more importantly, calm the nerves of independent voters who are voicing big concerns with the big spending and deficits. Even if Obama succeeds - and that’s a big if - it will be tough for many Democrats to sell themselves as deeply concerned about spending after voting for the stimulus, the bailouts, the health care legislation and a plan to address global warming, four enormous government programs.

“Democrats have to reassure voters we are not being reckless,” said a Democratic official involved in the planning. “The White House knows this and that's why we'll be hearing a lot about reducing the deficit early next year. Democrats owned this issue for the past four years and cannot afford to cede it to Republicans now."

*****

The big question for Obama – and the country – is whether the sudden concern about deficits will be more rhetoric than reality once his first State of the Union address concludes.

All presidents promise deficit reduction – and almost always fall short. There is good reason to be skeptical of this White House, too, on its commitment.

*****

But many moderate Democrats are deeply troubled by two recent signs of serious discontent among independent voters. The first was how badly Democrats lost among independent voters in the New Jersey and Virginia gubernatorial races. The second was a Gallup poll released this week that showed Republicans winning the independent vote by 22 points in generic matchups for House and Senate races. That same poll had the parties tied among independents in July.

Most of the competitive House and Senate races are in swing districts in which independent voters are the deciders.

“A lot of independents, Democrats and Republicans -- all are concerned about is what are we going to do about this long-term debt,” Obama told ABC’s Jake Tapper Monday. “We've got to show people that we are responsible stewards for their taxpayer dollars and that we're taking some serious steps to at least lay the foundation -- the pathway -- for bringing those deficits down over the next several years.”

http://www.politico.com/news/stories/1109/29471.html

[Mr. Big Dog 10,747]

The Blue Dogs and the Grumpy Obstructionist Party ought to love this.

[I AM NOT THAT GUY 5,715]

The Blue Dogs and the Grumpy Obstructionist Party ought to love this.

With a Republican Congress in 2011 onward, the President might just get that deficit reduction, via a train wreck. Worked for Clinton, though not the way he planned it.

[Mr. Big Dog 10,747]

The Blue Dogs and the Grumpy Obstructionist Party ought to love this.

With a Republican Congress in 2011 onward, the President might just get that deficit reduction, via a train wreck. Worked for Clinton, though not the way he planned it.

Wet dreams again, Ranger?

[I AM NOT THAT GUY 5,715]

The Blue Dogs and the Grumpy Obstructionist Party ought to love this.

With a Republican Congress in 2011 onward, the President might just get that deficit reduction, via a train wreck. Worked for Clinton, though not the way he planned it.

Wet dreams again, Ranger?

Deja vu.

[luckytxn 2,264]

At least with Clinton we got more than just a deficit reduction but a surplus.

[I AM NOT THAT GUY 5,715]

At least with Clinton we got more than just a deficit reduction but a surplus.

On paper dude! On paper. That was what everybody was trying to tell Bush, but did he listen? I don't think so!

[Mr. Big Dog 10,747]

At least with Clinton we got more than just a deficit reduction but a surplus.

On paper dude! On paper.

Debt to GDP ratio was 66% when Slick Willie took office and 57% when he left. While the debt never really decreased, relative to the GDP, it was reduced during Clinton's term. The spending spree that Bush and the GOP embarked on following Clinton's Presidency took care of that positive trend rather quickly and ensured that debt to GDP ratio was at roughly 90% when Bush left the White House and on a devastating trajectory for years to come.

[I AM NOT THAT GUY 5,715]

Debt to GDP is not a realistic measure, especially when you are in the middle of a tech and real estate boom, which is why, when first one collapsed, and then the other, revenues from capitial gains taxes disappeared, and so did any surplus, real, or imagined.

Federal Deficit as a Percentage of GDP

Debt Held by the Public as a Percentage of GDP

[one...two...tree 2,762]

Heritage Foundation charts, Bill? Try finding a non-partisan economic policy research institute that supports your claims.

[mawilson 2,133]

Debt to GDP is not a realistic measure, especially when you are in the middle of a tech and real estate boom, which is why, when first one collapsed, and then the other, revenues from capitial gains taxes disappeared, and so did any surplus, real, or imagined.

Federal Deficit as a Percentage of GDP

Debt Held by the Public as a Percentage of GDP

The chart is wrong. The public debt is already at 85% GDP.

[I AM NOT THAT GUY 5,715]

Pffft! to you both!

http://www.whitehouse.gov/omb/budget/fy2009/pdf/hist.pdf

[mawilson 2,133]

Dude - the difference between the gross debt and the public debt is the amount the government owes itself.

The numbers are meaningless without it.

And the chart is still wrong - as I said, we're already at 85%, not at 70% in 2010, as the chart claims.

[one...two...tree 2,762]

Bill, do you know how much money that Bush spent on the financial bailouts via Hank Paulson? Do you know how much the Stimulus cost in comparison? Let's try not to be selective about the facts.

[mawilson 2,133]

http://www.usdebtclock.org/