Texas Rep. Jeb Hensarling, at a nationally televised meeting of House Republicans in Baltimore, accused President Obama to his face of running up deficits a dozen times greater than the GOP’s. The president said, "That’s factually just not true, and you know it’s not true," and he invited "any independent fact-checker out there" to assess which man got the facts right.
OK, we will.
We have to score this one for Obama. Hensarling told a Texas-size whopper — and then tried to claim Republican credit for Blll Clinton’s budget surpluses.
Let’s look at exactly what was said, and what the facts show.
Hensarling said that under Obama, "what were the old annual deficits under Republicans have now become the monthly deficits under Democrats."
Hensarling, Jan. 29: [A] year ago, the Republicans proposed a budget that ensured that government did not grow beyond the historical standard of 20 percent of GDP. It was a budget that actually froze immediately non-defense discretionary spending. It spent $5 trillion less than ultimately what was enacted into law, and unfortunately, I believe that budget was ignored. And since that budget was ignored, what were the old annual deficits under Republicans have now become the monthly deficits under Democrats. The national debt has increased 30 percent.
It’s true that deficits have grown under Obama, but not even close to as much as Hensarling claimed. The simple fact is that Obama inherited a federal deficit of $1.2 trillion on the day he was sworn in last year. Barely two weeks earlier, the nonpartisan Congressional Budget Office issued its regular "Budget and Economic Outlook" document, stating:
CBO, Jan. 2009: The federal fiscal situation in 2009 will be dramatically worse than it was in 2008. Under the assumption that current laws and policies remain in place (that is, not accounting for any new legislation), CBO estimates that the deficit this year will total $1.2 trillion, more than two and a half times the size of last year’s.
That $1.2 trillion projected deficit — the result of bills signed by Republican President George W. Bush — grew substantially after Obama signed his stimulus bill and submitted his own budget. But even so, by the time the fiscal year ended Sept. 30, the actual deficit was $1.4 trillion, CBO said.
CBO, Nov. 6, 2009: The federal government recorded a total budget deficit of $1.4 trillion in fiscal year 2009, about $960 billion more than the deficit incurred in 2008.
At the time Hensarling made his claim, CBO was projecting that the deficit for the year would be lower — about $1.3 trillion. Later, on Feb. 1, Obama unveiled a new budget that would push the current year’s deficit to a record $1.55 trillion, by his administration’s estimates. But Hensarling’s claim is untrue even comparing that higher figure to any of the eight fiscal years for which Bush signed the tax and spending bills. The new deficit figure comes out to an average of just under $130 billion per month. Bush’s lowest annual deficit was just under $158 billion in fiscal 2002. It reached nearly $459 billion in the fiscal year ending Sept. 30, 2008, and, as we mentioned, was on track to reach $1.2 trillion by the time Obama took office.
So how could Hensarling possibly justify his claim? By claiming credit for budget surpluses that occurred under a Democratic president and avoiding responsibility for the biggest deficits run up under Bush, that’s how.
He issued a news release the same day, stating that the average deficit was only $104 billion "in the 12 years that Republicans controlled the House." Republicans controlled the House during the last six years of President Bill Clinton’s administration (regularly voting against his budget bills). During that time, the U.S. was in the longest sustained economic boom in its history, and the federal government ran budget surpluses in fiscal 1998, 1999, 2000 and 2001 (the last year for which Clinton signed the spending and tax legislation). Hensarling’s accounting also avoids GOP responsibility for the last two years of Bush’s deficits, on grounds that Democrats took control of the House in January 2007.
We can’t stop with criticizing only Hensarling, however. The president invited a comparison of "your presentation versus mine." And the president tends to pick the rosiest figures available when talking about budget matters. For one thing, he claimed to have inherited a slightly higher deficit than CBO was predicting.
Obama: Now, look, let’s talk about the budget once again, because I’ll go through it with you line by line. The fact of the matter is, is that when we came into office, the deficit was $1.3 trillion. — $1.3 [trillion.] So when you say that suddenly I’ve got a monthly budget that is higher than the — a monthly deficit that’s higher than the annual deficit left by the Republicans, that’s factually just not true, and you know it’s not true.
And what is true is that we came in already with a $1.3 trillion deficit before I had passed any law.
Actually, as we’ve noted already, CBO put the figure at $1.2 trillion, which is $100 billion less than the figure Obama used.
Obama also claimed that when he entered office he was facing a projected deficit of $8 trillion over 10 years.
Obama (continuing): What is true is we came in with $8 trillion worth of debt over the next decade — had nothing to do with anything that we had done. It had to do with the fact that in 2000 when there was a budget surplus of $200 billion, you had a Republican administration and a Republican Congress, and we had two tax cuts that weren’t paid for.
He used the same figures in his State of the Union address Jan. 27. And as we reported then, the $8 trillion figure is derived from estimates made by Obama’s Office of Management and Budget. It’s fair to say Obama faced an ocean of red ink when he took office, but the 10-year total projected by the Congressional Budget Office was a couple trillion less than that at least, even adjusting for extending all of the Bush tax cuts, as Republicans supported.
Obama blamed the deficits he inherited in part on Bush’s expansion of Medicare to provide prescription drug coverage.
Obama (continuing): You had a prescription drug plan — the biggest entitlement plan, by the way, in several decades — that was passed without it being paid for.
It’s true that Medicare Part D (the drug benefit) was enacted with no increased revenues provided to compensate, and it was the biggest expansion of Medicare since the program was enacted. It is expected to cost the government nearly $48 billion in benefit payments this year, plus nearly $400 million in administrative costs, according to Obama’s latest budget (page 482). But altogether, that’s only 3 percent of the current year’s deficit as projected by the administration.
The president owned up to responsibility for $1 trillion of the projected 10-year deficit:
Obama: Now, we increased it by a trillion dollars because of the spending that we had to make on the stimulus. I am happy to have any independent fact-checker out there take a look at your presentation versus mine in terms of the accuracy of what I just said.
Actually, the stimulus bill was projected to cost $787 billion over 10 years at the time Obama signed it nearly a year ago.