Interesting study – see the original document (quick read, 8 pages, simple-to-understand, good graphics) at:
In 2001, the Congressional Budget Office forecast that the nation’s publicly-held debt would be eliminated by 2006, and a surplus of $2.3 trillion would have accumulated by now. Instead, the federal government is now carrying a public debt of more than $10 trillion.
(The gross national debt is more than $14 trillion. It also includes money the government owes itself, mainly because Congress has been raiding the Social Security trust fund for years. Talk about gross.)
How did things go so bad? Some Obama critics would have you believe the nation’s finances headed south with the spending spree that the president kicked off with the $800 billion stimulus package in February 2009. Not so, according to a new report from the nonpartisan Pew Fiscal Analysis Initiative.
Pew says legislation passed over the past decade explains about two-thirds of the accumulation of debt, and the stimulus accounts for just 6 percent of that total. The 2001-03 Bush tax cuts were a bigger factor, explaining 13 percent of the run-up in red ink; spending on the wars in Iraq and Afghanistan makes up 10 percent.
The factors are broken down further on pages 4-5 in the report. Interestingly, Medicare Part D — the new, unfunded entitlement for prescription drugs — is responsible for just 2 percent of the added debt.
Thanks, Rich.
Pew is a good source and this is an interesting study — shows that responsibility for the deficits goes all around: We were cutting taxes and increasing spending at the same time so that everybody stayed happy. Kind of supports the idea that fixing the deficits should be a blend of tax increases and spending reductions as most serious students of the problem have urged.