Bush & Obama: Slouching Us Toward
December 10, 2008
Barack Obama may be a self-anointed and
media-anointed "agent of change,” but the truth is that with respect to
economic policy, there’s not a dollar’s worth of difference between him and
Bush (and an ever depreciating dollar at that).
To grasp this fact that once again puts the truth to Swift’s observation
that a politician "never tells a truth but with an intent that you
should take it for a lie; nor a lie but with a design that you should
take it for a truth,” we must first understand the incubus of debt with
which G. W. Bush has smothered the nation.
First off, the U.S. Treasury tells us that on 1/20/2001, federal debt
(also called "the national debt”) stood at $5.73 trillion. Exactly seven
years later, it had grown by 60%, to a total of $9.18 trillion. (That’s
an average of $493 billion per year in deficit spending.)
Turning to calendar 2008 (through December 4), we find that the federal
government has spent $1.42 trillion more than it has taken in, thereby
not just producing the first ever trillion dollar annual deficit but
blowing away that milestone by nearly half a trillion.
This latest deficit has raised the national debt to $10.65 trillion (a
15% increase over the debt on 12/31/07) with 27 federal shopping days
left in the year.
Bad news. But given that politicians are involved in this business, it
is no surprise that "You ain’t seen nothin’ yet.” So, let’s fill in the
The debt mentioned above includes about $375 billion of the $750 billion
bailout money approved in early October. When the other half of the
bailout money is spent, that alone will push debt to $11.025 trillion.
However, the picture still isn’t complete; for in addition to the
bailout package, other federal rescue actions could cost taxpayers a
colossal amount of money.
What, then, is the total amount of rescue money for which the public is
currently on the hook?
Well, excluding the $750 bailout, CNBC puts the amount (from guarantees,
loans, swaps, etc.) at about $6.5 trillion as of 11/28/08, observing
that "far less has been committed...and money extended might not be
So, regarding the true national debt, there are three possibilities:
(1) If all rescue money is lost, the debt will be $17 trillion,
supplemented by $40 billion of basic deficit spending every month.
(2) If one-third is lost, the debt will be "only” $13 trillion, plus the
$40 billion monthly tab.
(3) If the government magically doesn’t lose a penny, Americans will
still bear the burdens created by an $11 trillion debt, $500 billion
annual budget deficits, $700 billion trade deficits, etc. — even while,
from A (agriculture) to Z (zoological research), they are constantly
besieged to support the weight of more federal borrowing.
Sadly and frighteningly, this is the nation’s debt situation six weeks
before Obama’s inauguration. And it will only get worse.
For example, on December 5, 2008, Congress approved $25 billion in aid
to the auto industry, the money to come from an Energy Department "loan
Who knew Energy had that kind of cash lying around? Or could it be that
Energy knows someone at the White House who knows someone at Treasury
who knows someone at the Federal Reserve authorized to place a call to
the Department of Engraving and Printing?
The saga of the Bush debt completed, we now turn to Obama and his
Obamaniacs, who, despite being fully aware of the foregoing facts,
propose the following:
...An economic "recovery” plan costing from $500 billion to $1 trillion.
...A war plan that will require trillions (yes, in total costs,
trillions) not only to fight a "limited” but "smart” war in Afghanistan
but also to "nation build” there — all the while maintaining an
appropriate presence in Iraq.
...A health care plan that will cost at least $100 billion for starters.
("For starters” because we can’t expect politicians to tell the truth
about runaway health care costs.)
...An "investment” plan that will spend hundreds of billions for tax
cuts, energy research, college tuition assistance, etc.
...A possible state and local bailout plan for which governors and
mayors want $150 billion, much of the amount not for one-time spending
but for recurring health care costs.
Does this represent all the borrowing that will go on as Democrats
assume control of the White House and Congress? Given liberal ideology,
who would dare bet it does?
Now, what does this religious devotion to the doctrine of borrow and
spend say about Obama? Well, for one thing, that he is Bush — except
that, like Paul Krugman, the incoming president likes to talk about
returning the nation to fiscal responsibility after the spending spree.
Trouble is, like his Nobel Prize winning hero, Obama speaks in exquisite
detail about borrowing by the trillions but never mentions a single
detail about how he will pay the piper.
Of course, that may be because his idea of change means outdoing "W” as
he madly stokes the furnace of the nation’s economic locomotive with
tons of borrowed paper money, all the while hoping the country doesn’t
go bankrupt before the next engineer climbs aboard to encounter (and be
blamed for) a disaster.
("A president should ask Americans to fire up the economic furnace with
responsibility, initiative, brains, blood, sweat, and tears? How
mindlessly old school!”)
On the other hand, Obama may really see himself as the anti-Bush who
hooks the American people on trillions of dollars of "free” services so
that he can stealthily achieve the liberal goal of deposing Sweden from
its lofty perch —
That is, taking the U.S. from 28% of GDP going to taxes (#26 in world
ranking) to somewhere above Number One Sweden’s 50%.
Disaster or Sweden — either way it’s goodbye to the America and the
American Dream of the Founders because despite the lies of politicians,
there’s never a free lunch, which is another way of saying the piper
will have his due...as he always does...one way or another.
Author’s Note: If
you have the stomach for the task and are interested in searching for
the amount of federal debt on a given day from 1993 to the present, go
www.treasurydirect.gov. Under "Government” click on "Enter.” Click
on "The Debt of the United States.” Click on "Debt to the Penny/Daily