Still a Tail

I barely skimmed Stephen Moore’s defense in the Washington Times of the deficits the Trump Administration plans to run into the indefinite future:

For years, we’ve been trying to get the CBO to use real-world scoring that reflects how businesses, workers and financial markets react to changes in tax rates. But no go.

This is why the left is having a field day with the CBO forecast that deficits under President Trump will average a trillion dollars a year for the next decade. This is supposed to be a result of Mr. Trump’s tax cuts, but hold on here. Take a look at the nearby chart. It shows the deficit forecast with and without the tax cuts. They are effectively the same.

Mr. Trump didn’t create $1 trillion deficits, he inherited them from the grand maestro of debt spending, Barack Obama. President Obama invented and then perfected the concept of 13-digit borrowing. His deficits in his first term reached $1.5 trillion — an Olympic record of fiscal recklessness.

Is there anything more hypocritical than liberals, who supported Mr. Obama’s policies that ran the debt from about $11 trillion to almost $20 trillion, now fainting over runaway deficit spending? Yes, Chuck Schumer, there is gambling going on here at this casino.

and it struck me that there is a parallel between the Obama Administration’s handling of the war in Afghanistan and the Trump Administration’s approach to fiscal policy. President Obama inherited the war in Afghanistan from George W. Bush. He then became its custodian, neither winning nor losing it outright.

Similarly, Donald Trump inherited a trillion dollar deficit and is now its custodian. Just because you inherited something from your predecessor does not obligate you to double down on it. Three administrations worth of utter fecklessness ensures defictis will continue into the indefinite future.

The deficit may be less or more than the CBO projects but there will be deficits. The trajectory of spending guarantees it and no one knows how to stop it. Heavens forfend, they might lose votes. The notion that the growth-induced increase in tax revenue will outstrip the spending is fatuous. For goodness sake, the debt overhang itself is going to retard growth.

Our key problem is that the two major political parties have become one trick ponies. The only tune the Republicans know is cutting taxes while the Democrats have announced their determination to relabel consumption as investment and spend every dollar they can tax, borrow, or create.

Whatever you call them consumption is not investment and taxation is reducing revenue.

4 comments… add one
  • steve

    Moore? The guy who has been banned from several newspapers of outright lying? Ok, this is misleading in many ways. When you want to make things sound much worse or much better, you use nominal dollars. You use charts only and don’t give the raw numbers. You don’t adjust for inflation and you don’t use any references, like GDP. You especially manage to forget context. Running a deficit when the economy is weak is much different than running one when it is stronger. In all seriousness, I don’t know the answer, does any first world country deliberately run pro-cyclical deficits?

    That aside, the gist of what you say is sort of true. Both parties are not responsible. I guess the difference is that the Democrats are willing to tax and spend, i.e. increase revenue and spending, while the GOP since Reagan believes in cutting taxes while also increasing spending, decreasing revenue while increasing spending, just on different stuff (some) than the Dems would. To be completely correct, neither party is willing to address Medicare and Medicaid which is the spending that really needs addressed.

    Steve

  • Gray Shambler

    “neither party is willing to address Medicare and Medicaid which is the spending that really needs addressed”

    They can’t. They want to be re-elected.

  • Gray Shambler

    Actually, I fear that every new American President is being told in truthful confidence that our military dominance is what allows us to run such huge deficits. Without which we could not afford the military power that sustains them. Can’t go on forever, or can it?

  • Roy Lofquist

    The President has no, zero, zip, de nada, nein control over spending. Constitutionally it is solely a legislative power. Practically the closest a president came was when Bill Clinton exercised a line-item veto which was eventually ruled unconstitutional. Nixon tried sequestration but was rebuffed.

    Under “regular order” the budget is sent to the president as 13 separate bills which gave him some leverage with a veto threat. Regular order has been suspended since 2009 thus forcing the president to veto the entirety of the budget or sign it.

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