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Yes, gay marriage is a big step forward. But, in the meantime: National debt when Obama started (1/20/2009): $10.6T National debt now: $19.4T Almost doubled

by jazzyk 10y ago

Yes, gay marriage is a big step forward. But, in the meantime: National debt when Obama started (1/20/2009): $10.6T National debt now: $19.4T Almost doubled.

tptacek 10y ago
It's a little hard to know where to start to respond to this. First, growth in the national debt under Obama has been comparable to that of the last 36 years of Republican presidencies. Obviously, you can't simply compare the raw numbers; depending on the metric you use, Obama is getting crushed by Reagan (who almost tripled the national debt), or is just outcompeting Bush. You can pick metrics in which Obama compares unfavorably to Bush and Reagan, or metrics in which he compares favorably, but from what I can tell, he's pretty much on par with every president for the last 36 years except for Clinton. Second, Obama isn't responsible for a big chunk of that debt growth: it simply represents a continuation of crisis policy from Bush's administration in response to the collapse of 2008. It also captures Bush's disastrous tax cuts, a policy that Republican-controlled legislatures have ensured Obama was stuck with. Third, the US GDP is ~17T. Our debt is just barely over 100% of GDP, within 10% of France, Canada, Singapore, and Belgium. As a percentage of GDP, it's not the highest its ever been, and the increase captures our response to the biggest financial catastrophe since the Great Depression. Fourth, seen through the lens of the GDP, it's clear that there's two bad things that can happen to the debt: our total debt can grow, and our GDP can shrink. Money spent on the recovery is, again, a huge factor in the increased debt. That money was spent in large part to prevent an even more disastrous contraction in the economy. And, indeed, despite a relatively anemic recovery, we're doing a hell of a lot better than Europe did. Finally, an important mitigating factor with our debt is the unique position we hold in the global financial system. Treasury yields remain at historic lows. The market seems unconcerned with the debt, and remains happy to finance us. Unsurprisingly, you can't really evaluate the financial picture of the US by comparing two simple dollar numbers.
- tcoppi 10y ago
  > Finally, an important mitigating factor with our debt is the unique position we hold in the global financial system. Treasury yields remain at historic lows. The market seems unconcerned with the debt, and remains happy to finance us. Not only that, but Federal expenditures to service the debt as a percentage of GDP have remained extremely low, lower than in the 80s and 90s [1]. It didn't even really rise that much from the Bush tax cuts and the financial crisis. By most measures then, the debt is relatively benign unless GDP starts taking a major nosedive. 1. https://fred.stlouisfed.org/series/FYOIGDA188S https://fred.stlouisfed.org/series/FYOIGDA188S
- lintiness 10y ago
  check out the debt service expenses of reagan, bush, and any other president in history. obama's benefited massively from low interest rates (same service expense as bush jr. with twice the debt load). his deficits are a fantasy.
  - tptacek 10y ago
    Lots of people have persuasive arguments for financial mismanagement in the Obama administration, and I'm not challenging them. I'm simply saying that none of those people get to pretend that their position is clear on its face by comparing two raw dollar numbers.
- jazzyk 10y ago
  1. I agree that Obama inherited the financial crisis, but he failed to implement unpopular financial decisions (balancing the budget, etc.), choosing instead to kick the can down the road. You may argue about the first year, etc. but he has been in office for 8 years now (he did nothing to prosecute people responsible for the crisis on Wall Street, either, despite fiery rhetoric). Also, for the first 2 years, his party controlled the House and the Senate, they could overturn any republican legislation they wanted. 2. The debt has never been higher during peace-time (shot higher during WW2 and came down quickly) 3. The widely accepted red-alarm level of debt is 60% of GDP (some countries have "circuit breakers" around that level). Crowing that there are worse offenders out there does not change the fact that we are (fast) approaching disaster. Financial engineering is not working for Japan, you can't force people to take on more debt, even if it is cheap. 4. As you can see from the graph referenced, the US debt stayed around 60% of GDP since 1955-ish until 2008. Only after 2008 it started ballooning. 5. I am not saying Republican legislatures were saintly, Bush clearly put us through a lot of financial pain due to unnecesssary wars, but the numbers are clear (see the link below) http://www.tradingeconomics.com/united-states/government-debt-to-gdp http://www.tradingeconomics.com/united-states/government-deb...
  - tptacek 10y ago
    No, it's a conservative talking point that there's a "red-alarm level of debt at 60% of GDP". By that definition, the following countries are all "red-alarm": Finland, Israel, The Netherlands, Brazil, India, Germany, Hungary, Austria, the UK, Canada, France, Singapore, Belgium, and Japan. (I'm leaving out lots of smaller countries, of course). But: once again: it is not my argument that there is no valid criticism of Obama's management of the economy and the financing of the government. I probably won't agree with most of those criticisms, but there are plenty of sound ones. What I reject is the idea that you can compare the raw dollar amount of the debt in 2008 and that number in 2016 and draw those kinds of conclusions. No, you have to do better.
    - jazzyk 10y ago
      Yes, two numbers may not be enough - that's why I followed up to show the debt/GDP _ratio_ over the years to show historical context, which disproves a couple of your points.
nbcesar 10y ago
"2/5ths of the increase during President Obama's presidency occurred during the first year while the country was still in the midst of the Great Recession."[0] "The President doesn't have much control over the debt added during his first year in office. That's because the budget for that fiscal year was already set by the previous President."[1] [0] http://politicsthatwork.com/graphs/debt-gdp-president http://politicsthatwork.com/graphs/debt-gdp-president [1] http://useconomy.about.com/od/usdebtanddeficit/p/US-Debt-by-President.htm http://useconomy.about.com/od/usdebtanddeficit/p/US-Debt-by-...

by jazzyk 10y ago

Yes, gay marriage is a big step forward. But, in the meantime: National debt when Obama started (1/20/2009): $10.6T National debt now: $19.4T Almost doubled.

tptacek 10y ago

It's a little hard to know where to start to respond to this. First, growth in the national debt under Obama has been comparable to that of the last 36 years of Republican presidencies. Obviously, you can't simply compare the raw numbers; depending on the metric you use, Obama is getting crushed by Reagan (who almost tripled the national debt), or is just outcompeting Bush. You can pick metrics in which Obama compares unfavorably to Bush and Reagan, or metrics in which he compares favorably, but from what I can tell, he's pretty much on par with every president for the last 36 years except for Clinton. Second, Obama isn't responsible for a big chunk of that debt growth: it simply represents a continuation of crisis policy from Bush's administration in response to the collapse of 2008. It also captures Bush's disastrous tax cuts, a policy that Republican-controlled legislatures have ensured Obama was stuck with. Third, the US GDP is ~17T. Our debt is just barely over 100% of GDP, within 10% of France, Canada, Singapore, and Belgium. As a percentage of GDP, it's not the highest its ever been, and the increase captures our response to the biggest financial catastrophe since the Great Depression. Fourth, seen through the lens of the GDP, it's clear that there's two bad things that can happen to the debt: our total debt can grow, and our GDP can shrink. Money spent on the recovery is, again, a huge factor in the increased debt. That money was spent in large part to prevent an even more disastrous contraction in the economy. And, indeed, despite a relatively anemic recovery, we're doing a hell of a lot better than Europe did. Finally, an important mitigating factor with our debt is the unique position we hold in the global financial system. Treasury yields remain at historic lows. The market seems unconcerned with the debt, and remains happy to finance us. Unsurprisingly, you can't really evaluate the financial picture of the US by comparing two simple dollar numbers.

tcoppi 10y ago
> Finally, an important mitigating factor with our debt is the unique position we hold in the global financial system. Treasury yields remain at historic lows. The market seems unconcerned with the debt, and remains happy to finance us. Not only that, but Federal expenditures to service the debt as a percentage of GDP have remained extremely low, lower than in the 80s and 90s [1]. It didn't even really rise that much from the Bush tax cuts and the financial crisis. By most measures then, the debt is relatively benign unless GDP starts taking a major nosedive. 1. https://fred.stlouisfed.org/series/FYOIGDA188S https://fred.stlouisfed.org/series/FYOIGDA188S
lintiness 10y ago
check out the debt service expenses of reagan, bush, and any other president in history. obama's benefited massively from low interest rates (same service expense as bush jr. with twice the debt load). his deficits are a fantasy.
- tptacek 10y ago
  Lots of people have persuasive arguments for financial mismanagement in the Obama administration, and I'm not challenging them. I'm simply saying that none of those people get to pretend that their position is clear on its face by comparing two raw dollar numbers.
jazzyk 10y ago
1. I agree that Obama inherited the financial crisis, but he failed to implement unpopular financial decisions (balancing the budget, etc.), choosing instead to kick the can down the road. You may argue about the first year, etc. but he has been in office for 8 years now (he did nothing to prosecute people responsible for the crisis on Wall Street, either, despite fiery rhetoric). Also, for the first 2 years, his party controlled the House and the Senate, they could overturn any republican legislation they wanted. 2. The debt has never been higher during peace-time (shot higher during WW2 and came down quickly) 3. The widely accepted red-alarm level of debt is 60% of GDP (some countries have "circuit breakers" around that level). Crowing that there are worse offenders out there does not change the fact that we are (fast) approaching disaster. Financial engineering is not working for Japan, you can't force people to take on more debt, even if it is cheap. 4. As you can see from the graph referenced, the US debt stayed around 60% of GDP since 1955-ish until 2008. Only after 2008 it started ballooning. 5. I am not saying Republican legislatures were saintly, Bush clearly put us through a lot of financial pain due to unnecesssary wars, but the numbers are clear (see the link below) http://www.tradingeconomics.com/united-states/government-debt-to-gdp http://www.tradingeconomics.com/united-states/government-deb...
- tptacek 10y ago
  No, it's a conservative talking point that there's a "red-alarm level of debt at 60% of GDP". By that definition, the following countries are all "red-alarm": Finland, Israel, The Netherlands, Brazil, India, Germany, Hungary, Austria, the UK, Canada, France, Singapore, Belgium, and Japan. (I'm leaving out lots of smaller countries, of course). But: once again: it is not my argument that there is no valid criticism of Obama's management of the economy and the financing of the government. I probably won't agree with most of those criticisms, but there are plenty of sound ones. What I reject is the idea that you can compare the raw dollar amount of the debt in 2008 and that number in 2016 and draw those kinds of conclusions. No, you have to do better.
  - jazzyk 10y ago
    Yes, two numbers may not be enough - that's why I followed up to show the debt/GDP _ratio_ over the years to show historical context, which disproves a couple of your points.

nbcesar 10y ago

"2/5ths of the increase during President Obama's presidency occurred during the first year while the country was still in the midst of the Great Recession."[0] "The President doesn't have much control over the debt added during his first year in office. That's because the budget for that fiscal year was already set by the previous President."[1] [0] http://politicsthatwork.com/graphs/debt-gdp-president http://politicsthatwork.com/graphs/debt-gdp-president [1] http://useconomy.about.com/od/usdebtanddeficit/p/US-Debt-by-President.htm http://useconomy.about.com/od/usdebtanddeficit/p/US-Debt-by-...