- Heartland Interviews Michael Shellenberger on His New Book, Apocalypse Never - July 4, 2020
- PODCAST: Panic Is a Terrible Idea – Talking Wuhan Virus (Coronavirus or COVID-19) and Some ‘On Theme’ Music Vids - March 15, 2020
- Dr. Richard Keen, R.I.P. - January 27, 2020
The other night in a debate on Chicago’s PBS station, the host threw in the face of Heartland’s Steve Stanek a chart promoted by big-spending liberals — such as The Washington Post’s Ezra Klein — that is supposed to be proof that President Obama’s spending is nothing compared to that of his predecessor.
Steve, well-prepared for the query (see his story at Budget & Tax News), would not be a victim of an ambush. He reached into his brain for the perfect description of the chart, calling it “mendacious.”
So … let’s look at that infamous liberal talking point of a chart and compare it to reality.
Said Steve at about the 7:25 mark of this video, which host Carol Marin says “should accompany all of our discussions on the debt ceiling”:
Yeah. I saw that chart. It’s a mendacious chart. He puts spending with tax cuts, but they are not the same thing. Spending is spending, and tax cuts are tax cuts.
There is a famous economist, Kurt Hauser, who has what has come to be know as Hauser’s Law — which documents going back over decade over decade of government spending that tax rates really don’t have that much of an impact on how much revenue government gets as a percentage of GDP.
And that is because if you raise tax rates, you tend to supress economic activity. And so you might be collecting more pennies for every dollar the economy creates, but you have fewer dollars being created. If you lower tax rates, you tend to stimulate economic activity. And even though you are colecting fewer pennies for every dollar of economic activity, you have more dollars being created. So that is a mendacious chart.
That’s the same economic theory proven by the Laffer Curve. But Steve’s fellow guests on Chicago Tonight disagreed, of course. It was three-on-one kind of show. But let’s put Hauser and Laffer aside. Let’s look at an accurate chart gauging government spending over the last decade or so — not one manipulated by those who want to erase from our budget picture, Soviet-style, the reality of our federal government’s fiscal history.
I apologize if you experienced vertigo, but what you see immediately above is reality. The liberal talking-point chart is absurd. Or, as Steve said, “mendacious.” Otherwise known as a lie.
For starters (as Steve points out), about half of the “spending” by George W. Bush is actually a tax cut. That is not a government “expense” — unless you believe that everything working Americans earn through their labor is first the property of government, and then parceled back through the benevolence of politicians in Washington. Liberals, leftists and statists (I want to be thorough) actually think this way.
Second, notice how the cost of the wars in Afghanistan and Iraq are entirely on the ledger of Bush, but absent on the ledger of the current president — who, by the way, campaigned on ending those wars and pouring that money into “nation-building here at home.” Are we to pretend that such spending under Obama doesn’t count?
As I noted in a Somewhat Reasonable post the other day, the total of 10 years of fighting a war on Islamist terrorists equals just a single year of deficit spending by Obama. Hell, the total spending of the war on terror over a decade— on two fronts, including diplomacy — almost equals what Obama pissed away in useless “stimulus” in his second month in office. (Also, the idea that Obamacare is going to cost the government just $152 billion through 2017 is simply absurd.)
As the second chart above shows, Obama’s deficit spending each year dwarfs that of his predecessor — and that presumes ridiculously rosy scenarios of at least 4 percent economic growth. It would be laughable … if not for the fact that Obama’s taxing and regulatory policies were not so destructive to our economy.
George W. Bush inherited a $5 trillion national debt, and it was $10 trillion when he left eight years later. No one at Heartland has ever celebrated or excused that. But the national debt today is $14 trillion. So, do the math: Obama has accomplished in two-plus years just about the equal of government debt-making that it took Bush two whole terms to pull off. Obama’s stimulus alone has raised the “baseline” of government spending another trillion dollars — again, in just two years.
The idea that Obama is the austerity president compared to any and all of his predecessors is nothing more than a liberal fantasy.