Sunday, June 17, 2012

President Obama: The Biggest Government Spender In World

Peter Ferrara, Contributor
I cover public policy, particularly concerning economics.
OP/ED 
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6/14/2012 @ 3:42PM |175,435 views

President Obama: The Biggest Government Spender In World History

The U.S. has never before had a President who thinks so little of the American people that he imagines he can win re-election running on the opposite of reality. But that is the reality of President Obama today.
Waving a planted press commentary, Obama recently claimed on the campaign stump, “federal spending since I took office has risen at the slowest pace of any President in almost 60 years.”
Peggy Noonan aptly summarized in last weekend’s Wall Street Journal the take away by the still holding majority of Americans living in the real world:
“There is, now, a house-of-cards feel about this administration.  It became apparent some weeks ago when the President talked on the stump – where else? – about an essay by a fellow who said spending growth [under Obama] is actually lower than that of previous Presidents.  This was startling to a lot of people, who looked into it and found the man had left out most spending from 2009, the first year of Mr. Obama’s Presidency.  People sneered: The President was deliberately using a misleading argument to paint a false picture!  But you know, why would he go out there waiving an article that could immediately be debunked?  Maybe because he thought it was true.  That’s more alarming, isn’t it, the idea that he knows so little about the effects of his own economic program that he thinks he really is a low spender.”
What this shows most importantly is that the recognition is starting to break through to the general public regarding the President’s rhetorical strategy that I’ve have been calling Calculated Deception.  The latter is deliberately using a misleading argument to paint a false picture.  That has been a central Obama practice not only throughout his entire presidency, but also as the foundation of his 2008 campaign strategy, and actually throughout his whole career.
Rest assured, Ms. Noonan, that the President is not as nuts as he may seem at times.  He knows very well that he is not a careful spender.  His whole mission is to transform the U.S. not into a Big Government country, but a Huge Government country, because only a country run by a Huge Government can be satisfactorily controlled by superior, all wise and beneficent individuals like himself.  That is why he is at minimum a Swedish socialist, if not worse.  Notice, though, how far behind the times he and his weak minded supporters are, as even the Swedes have abandoned Swedish socialism as a failure.
The analysis by Internet commentator Rex Nutting on which Obama based his claim begins by telling us “What people forget (or never knew) is that the first year of every presidential term starts with a budget approved by the previous administration and Congress.”  Not exactly.
The previous administration, or President, proposes a budget.  The previous Congress approves a budget.  And what Congress approves can be radically different from what the President proposes.
As Art Laffer and Steve Moore showed in the Wall Street Journal on Tuesday, President Bush began a spending spree in his term that erased most of the gains in reduced government spending as a percent of GDP achieved by the Republican Congress in the 1990s led by former House Speaker Newt Gingrich, in conjunction with President Clinton.  But for fiscal year 2009, President Bush in February, 2008 proposed a budget with just a 3% spending increase over the prior year.  Fiscal year 2009 ran from October 1, 2008 until September 30, 2009.  President Obama’s term began on January 20, 2009.
Recall, however, that in 2008 Congress was controlled by Democrat majorities, with Nancy Pelosi as Speaker of the House, and the restless Senator Obama already running for President, just four years removed from his glorious career as a state Senator in the Illinois legislature.  As Hans Bader reported on May 26 for the Washington Examiner, the budget approved and implemented by Pelosi, Obama and the rest of the Congressional Democrat majorities provided for a 17.9 percent increase in spending for fiscal 2009!
Actually, President Obama and the Democrats were even more deeply involved in the fiscal 2009 spending explosion than that.  As Bader also reports, “The Democrat Congress [in 2008], confident Obama was going to win in 2008, passed only three of fiscal 2009’s 12 appropriations bills (Defense, Military Construction and Veterans Affairs, and HomelandSecurity).  The Democrat Congress passed the rest of them [in 2009], and [President] Obama signed them.”  So Obama played a very direct role in the runaway fiscal 2009 spending explosion.
Note as well that President Reagan didn’t just go along with the wild spending binge of the previous Democratic Congress for fiscal year 1981 when he came into office on January 20 of that year.  Almost no one remembers now the much vilified at the time 1981 Reagan budget cuts, his first major legislative initiative. Then Democrat Rep. Phil Gramm joined with Ohio Republican Del Latta to push through the Democratic House $31 billion in Reagan proposed budget cuts to the fiscal year 1981 budget, which totaled $681 billion, resulting in a cut of nearly 5% in that budget.  Obama could have done the exact same thing when he entered office in January, 2009, even more so with the Congress totally controlled by his own party at the time.
Reagan then ramped up the spending cuts from there.  In nominal terms, non-defense discretionary spending actually declined by 7.1% from 1981 to 1982.  But roaring inflation at the time actually masks the true magnitude of the Reagan spending cut achievement.  In constant dollars, non-defense discretionary spending declined by 14.4% from 1981 to 1982, and by 16.8% from 1981 to 1983.  Moreover, in constant dollars, this non-defense discretionary spending never returned to its 1981 level for the rest of Reagan’s two terms!  By 1988, this spending was still down 14.4% from its 1981 level in constant dollars.

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