Are the Bush Tax Cuts the source of deficit?

Inflation adjusted figures are in the next column over. In terms of 2005 dollars, revenues were nearly unchanged from 2000-2008 which is pretty good considering we were in the middle of a recession in 2008. However, inflation adjusted spending increased a staggering 32% over the same period.

Furthermore, federal outlays as a percentage of the GDP for 2009 & 10 are higher than any other years since WWII!

Pretty strong case that spending not revenues is the problem.
 
Why weren't the Republicans concerned about a balanced budget when Bush was in office? (or Reagan for that matter?)

They think if they torpedo the economy (again) the backlash will be against Obama; so its a good thing.
 
I cannot speak for Republicans but fiscal conservatives think Bush was a failure for this very reason. It has not reached crisis status until the past two years though as we have seen the deficit skyrocket to unimaginable levels.
 
Revenue in 2009 and 2010 as a percentage of GNP was at its lowest level since 1950. Spending was at the highest level during the same time.

There is of course a reason why. We have been through the worst recession since the depression. The government had to spur growth with increased spending or we would have slid into a depression.

But as we come out of the recession, we need to bring both spending and revenue back into line with historical standards, which of course is exactly what Obama offered to Boehner. Three trillion in cuts and $1.2 trillion in revenue.

And lets look at the revenue. Along with getting rid of some tax breaks to corn, oil, etc, the proposal is to eliminate the Bush tax cuts for single people at an AGI of over $250K and families over $300K. First keep in mind that to end up with an AGI of $300K, my guess is that gross pay would be at least $370K. So how much more would a family pay if their AGI was $300,001 and the Bush tax cut was eliminated. They would pay an extra nickel or exactly what they owed in taxes during the Clinton boom years. If they made $400K they would have to pay an extra $5K I can promise you that $5K in extra taxes would be dwarfed by the increase in their investments that would result from a healthier economy.

So yes, we have a spending problem and we have a revenue problem and a President who has proposed to reduce the spending problem by $3 trillion and the revenue problem by $1.2 trillion. I don’t need my Economics degree from the best University in the world to know that such a bill should have already been passed and signed.
 
Why don't we just do away with the debt limit altogether, print up a quadrillion dollars to make our precious bankers whole, mandate 100% employment, and raise the minimum wage to $100,000? Prosperity for all is there for the taking if we could just get past the damned obstructionists. Why won't they think of the children?
 
The following were all "unfunded" events, which eliminated the Clinton surplus that was there when he left office:

- Bush Tax Cuts
- Medicare Part D (Prescription subsidizing)
- 2 Wars

Hook'em!!!
texasflag.gif
 
****, I'm sick of this argument! The government needs to stop assuming we are all wandering idiots and let the population run the free market.

Motivated people will have the money and lazy or less motivated people will have much less. That's fair! There are less than 8% that can't help themselves and the government can intervene at that point.

The government needs to step back and stop spending billions on every ******** thing they think they own or can buy votes by spending my(our) money.
 
The free market all by itself leads to monopolies running everything.

We learned that back in the day of Theodore Roosevelt, the last Republican president that didn't stay bought and paid for in the words of Jupiter Pierpont Morgan himself.
 
hornpharmd,

please look at how the economy fits into your ideals. During the second half of the Clinton presidency when republicans held congress, we had an economic bubble where high tech companies with no history of profitability were valued higher than companies such as Goldman, Caterpillar, and Alcoa. When Bush was in power with a Democrat controlled congress, that bubble had disappeared and the economy was heading towards the bottom of the economic cycle.
 
Thanks for clarifying ag with many kids. I was hoping that pharmd would understand the relationship between tax receipts and the economy and the reason that lower taxes help reverse recessions.
 
Okay, Ag, here is another way to look at it.

year - Receipts (billions)
00 - 2,310
01 - 2,215.3
02 - 2,028.6
03 - 1,901.1
04 - 1,949.5
05 - 2,153.6
06 - 2,324.1
07 - 2,414.0
08 - 2,286.8
09 - 1,898.3
10 - 1,919.0
Total - 23,400.3 (2,127.3 11 year average)
Total 02 to 09 - 16,956 (2,119.5 8 year average under Bush)

Year - Outlays (billions)
00 - 2,040.6
01 - 2,072.7
02 - 2,201.3
03 - 2,303.9
04 - 2,377.5
05 - 2,472.0
06 - 2,563.8
07 - 2,565.1
08 - 2,702.3
09 - 3,172.2
10 - 3,066.7
Total - 27,538.1 (2,503.5 11 year average)
Total 02 to 09 - 20,358.1 (2,544.8 8 year average)

We went from a surplus in 98, 99, 00, 01, then when Bush policies went into effect we saw decreases in revenues for a few years and a continual increase in spending throughout 02 to 09. This was due to 2 primary factors. Bush tax cuts leaving less revenue on the table and Increased spending (Medicare Part D, 2 Wars, Dept of Homeland Security, etc).

What is also interesting is to look at receipts as a % to GDP from 98 to 09:
98 - 19.9%
99 - 19.8%
00 - 20.6%
01 - 19.5%
02 - 17.6%
03 - 16.2%
04 - 16.1%
05 - 17.3%
06 - 18.2%
07 - 18.5%
08 - 17.5%
09 - 14.9%

Spending as a % of GDP dropped significantly in 02 and has stayed down since then. We saw an uptick slightly from 05 to 08 but it never went up as high as it was from 98 to 02. So yes there was a bubble during the Bush years that saw some increases in revenue but as a % of GDP the revenue was still much smaller than it had been pre Bush tax cuts. And it still is. That is why I see the Bush tax cuts as a large reason for a decrease in revenue since 02 and a large reason we are seeing these large deficits. Of course spending has gone up as well and that is also an issue. But the deficits would not be as large and we would not be talking about such a large debt hole to climb out of right now if we had not had the bush tax cuts.
 
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