[Vision2020] They Made War and He Saved the Economy: Republicans vs. Obama on the Debt

[Nicholas Gier]

Dear Visionaries:

Below is my radio commentary/column for the week.  The full versions is
attached.

The American people have a clear choice for president.  How could any
reasonable person believe that cutting taxes even more will produce jobs
and reduce the deficit?  Bush 43 proved that it does not work.  Austerity
policies are driving some European countries into another recession, and
Greece is headed for a depression.

I prefer National Public Radio for the most moving stories about the
military, and the sacrifices that have been made.  The most tragic are
those in wars that we should never have started.

Another Somber Memorial Day,

Nick

*Republicans vs. Obama on the Debt:*

*They made War but Obama saved the Economy*

By Nick Gier

GOP Senate leader Mitch McConnell and others are lambasting Obama for
raising the national debt by 41 percent.  Why don’t they tell us that their
hero Ronald  Reagan’s record was far worse: a 189 percent increase over 8
years.

When Reagan took office in 1981, Uncle Sam was in the red $930 billion, and
the GOP candidate blamed Jimmy Carter for a “debt out of control.” But as
the Gipper left office the debt was a whopping $2.7 trillion. Reagan’s tax
cuts were so severe and increases in defense spending so great that he was
forced to raise taxes every year except one. Bush 41 added another $1.5
trillion for an increase of 278 percent over 12 years.  Bush 43 put us down
another $5.04 trillion for another 89 percent increase.

In 2011 we paid $187 billion in interest on the debt, but in the last year
of Reagan’s second term the interest payment was $214 billion.  The simple
reason for so little difference is that the government in 1981 was
borrowing at 12.57 percent.



Bush 43 cut taxes, waged two unfunded wars, passed an unfunded senior drug
program, and had the worst job record since Herbert Hoover.  Why should we
believe the Republicans when they keep saying that cutting taxes even more
will produce new jobs?  Economist Adam Hersh has done a state-by-state
analysis which demonstrates that those states that cut funding the most had
the greatest job losses.


The Bush 43-Obama commitment to save the auto industry has been a great
success, saving at least 1.4 million jobs. Obama has created the most
manufacturing jobs since 2005 and at a rate faster than any time since
1997.  For 26 straight months there have been job gains in the private
sector.


Much of this success was due to the stimulus bill, the effects of which
unfortunately have worn off.  The stimulus grew the economy by an estimated
3.2 percent; it is now at a weak 1.6 percent. A number of economist
consultants from all persuasions have concluded that at least 2 million and
at most 4.8 million jobs were created by the Recovery Act of 2009.

If one compares the Ryan and Obama budgets, there are some stark
differences.  By allowing the Bush tax cuts to expire and increasing taxes
on the rich, Obama preserves Medicare and brings down the annual deficit to
3.2 percent by 2021.  In April 2010 the figure was 11.1 percent and now it
is at 7.6 percent and still falling.



The Eurozone deficit is down to 3.5 percent, and it would be much lower if
Ireland’s 13.5 percent were excluded.  The Irish Labor Party has, for the
very first time, joined a new coalition government after the Conservatives
ruined the economy.



Making even deeper tax cuts, privatizing Medicare and cutting the social
safety net to shreds, the Ryan budget would still have a 1.8 percent annual
deficit in 2021.  Even with Romney as president with a GOP Congress, only
the most die-hard Tea Partiers would support such draconian measures and
the American people would not stand for it.  Obama has proved that he can
reduce the deficit, while the GOP has not.



The Center for Budget and Policy Priorities has calculated the long-term
effects of various elements of the national debt, assuming that the Bush
tax cuts are still in place.  By 2019 that lack of revenue will add $600
billion of the debt burden in contrast to $75 billion for Obama’s stimulus.



We will still be paying $320 billion for the Great Recession (primarily
caused by the financial sector), and $150 billion for the wars in Iraq and
Afghanistan. Obama chose to run deficits to save the economy, while the
Republicans borrowed money in good economic times to wage three wars—one
cold and two hot.



The national polls are still very close, but the projected electoral
college numbers look very good for Obama.  Counting strong/weak Obama and
Romney states Electoral-vote.com has Obama leading 285 to 167.  Obama must
win or this country is going to drown in a sea of debt.



Nick Gier taught philosophy at the University of Idaho for 31 years.  The
references and tables for this column have been gathered at
www.NickGier.com/debt.pdf <http://www.nickgier.com/debt.pdf>.
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