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The L.A. Times’ Fiscal Fantasies

Obama, Si; Bush #43, No: The L.A. Times' historical revisionism and rose-colored crystal ball.

by
Tom Blumer

Bio

October 19, 2013 - 12:01 am

Miscasting the results achieved during the presidency of George W. Bush is one of the more important elements of the national establishment press’s non-stop attempt to defend Barack Obama’s utterly indefensible fiscal record.

David Lauter’s contribution to that effort appeared at the “Politics Now” Blog at what remains of the Los Angeles Times on October 16. He claimed to be conveying “four facts about the national debt you may not know.” Readers could have and should have stopped at Item One. Combined with the Bush #43 historical revisionism contained within that assertion, Lauter concocted the Certs Breath Mint of falsehoods: “Two Lies in One.”

This isn’t about a newbie journalist just out of college. Lauter is an assistant managing editor who is old enough to remember those Certs commercials. In his position, he “oversees the Times’ coverage of news across California, heading the news organization’s largest editing and reporting staff.”

Lauter’s opening pseudo-fact is that “the U.S. debt burden is starting to decline.” Not “will decline in the future” (which itself is almost definitely not the case, as will be seen later), but “is starting to decline.” No such decline is underway, even under Lauter’s permissive definition of “burden,” which is “debt held by the public as a percentage of gross domestic product (GDP).”

The Congressional Budget Office Baseline Budget Projections to which he links tell us that public debt to GDP was 72.6 percent at the end of fiscal 2012, will be 75.1 percent when the government finally closes its books on the September 30 fiscal year just ended, and will be 76.2 percent at the end of fiscal 2014. Without identifying the specific values, Lauter says that the 2014 value, at 1.1-points above 2013, will be “at about the same level.” That’s quite ironic, considering his characterization of what happened during Bush 43′s presidency:

By that measure, the debt grew rapidly during most of President George W. Bush’s tenure and President Obama’s first term as the government borrowed money to fight two wars and the deepest recession in more than half a century. But the rapid growth ended more than a year ago.

While there is little argument that George W. Bush’s fiscal stewardship was far from ideal, Lauter’s claim of rapid growth “during most of President George W. Bush’s tenure” is brazenly and outrageously false. His breezy attempt to make what occurred during the Bush 43 era roughly equivalent to what we’ve seen during Barack Obama’s presidential tenure compounds the deception, as the following table demonstrates:

Bush43andObamaDebtVsGDPto0913

Using the results of full budget years and assigning responsibility by presence in office, the table shows that there were decreases or negligible increases in public debt to GDP during 44 of Bush’s 96 months. There were increases of between one point and two points, which by Lauter’s aforementioned standards are clearly not significant, during another 36. Only 17 percent of Bush’s two terms contained full or partial fiscal years with public debt-to-GDP growth of two points or more, and only his final four months saw the kind of rapid annualized growth (5 points or more) seen during over half (57 percent) of Barack Obama’s presidency to date.

But what if one were to assign presidential responsibility based on budgets passed — or in Obama’s case, fiscal auto-pilot exercises conducted — during their respective terms? This would give Bill Clinton credit for Bush 43′s first eight months of public debt-to-GDP decline, and would blame Bush for Obama’s first eight disastrous months, despite the Texan having no involvement in 2009′s deficit- and debt-driving stimulus plan. Even in that tortured framework, six of the eight budgets for which Bush was supposedly responsible showed public debt-to-GDP decreases or small increases. Such increases during Obama’s presidency have all ranged from large to very large.

Here is how it all looks when presented in a chart:

Bush43andObamaDebtVsGDPto0913chart
It’s quite obvious that the vast majority of Bush 43′s presidency was marked by modest growth in public debt as a percentage of GDP, and that things did not begin to get out of hand until the first full budget year after the Democratic Party took control of the House and Senate. Absolutely all of Barack Obama’s presidency has seen catastrophic growth in that percentage.

There is almost certainly no end in sight in debt-to-GDP growth, despite Lauter’s contention, presented as if factual, that “the debt will tick down slowly to around 71% of GDP in 2018.”

CBO’s projections assume annual nominal GDP growth of 5.9 percent or more, or well over 3 percent after inflation, during each of the three fiscal years ending in 2017. In the four years since the recession officially ended, the economy has grown at a compound annual rate of 2.2 percent.

What in the world is there on the economic policy front which would give anyone but a blind leftist partisan the idea that stronger economic growth is on the horizon? Is it the relentlessly growing army of Obamacare part-timers? The mind-boggling incompetence of the Obamacare rollout? The plundering of red states, the young and self-employed upper middle-class hard-wired into Obamacare itself? The EPA’s war on coal and fossil fuel-based energy? Beyond that, for CBO’s projections to come true, the Fed’s relentless generation of money from nothing must continue to keep interest rates historically low. There have already been signs of serious weakening on that front.

Lauter’s background clearly establishes not only that he should know better than to compose and publish such rubbish, but that he also does know better. So apparently he doesn’t care that he has presented self-evident lies. Work such as his goes a long way towards explaining why daily circulation at the Times, which was 900,000 in 2006, was only 494,352 as of March 31.

That’s clearly 494,352 too many.

Along with having a decades-long career in accounting, finance, training and development, Tom Blumer has written for several national online publications primarily on business, economics, politics and media bias. He has had his own blog, BizzyBlog.com, since 2005, and has been a PJM contributor since 2008.

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42 weeks ago
42 weeks ago Link To Comment
my best friend's ex-wife makes $85/hour on the internet. She has been fired from work for ten months but last month her check was $12227 just working on the internet for a few hours. More Help.....WWW.Rush64.COM
1 year ago
1 year ago Link To Comment
So in conclusion, we lost big with both parties - vote third party.
1 year ago
1 year ago Link To Comment
Google is paying 80$ per hour! On tuesday I got a great new Land Rover Range Rover from having earned $4151 this last four weeks. its the most-financialy rewarding I've had. It sounds unbelievable but you wont forgive yourself if you don’t check it out WWW.Pow6.com
1 year ago
1 year ago Link To Comment
LATimes has a disappointingly inward focus.
1 year ago
1 year ago Link To Comment
Federal spending or deficits or debt should not be converted to ratios of the gross domestic product. GDP is not tightly correlated with federal spending or deficits. If federal spending stays the same while GDP rises due to increased productivity, the ratio of federal spending to GDP goes down. This gives a false impression of reduced government spending. If federal spending stays the same while productivity falls during a recession, the ratio of spending to GDP goes up. This gives a false impression of increased government spending.

There is no need to create inaccurate data. Inflation conversion tables are readily available. All spending or borrowing trends should be displayed as inflation-corrected dollars. More sophisticated analyses can contain adjustments for population changes.
1 year ago
1 year ago Link To Comment
They don't know speed from acceleration, past from future, or fact from fantasy. BTW regarding TARP - $700b, only half was ever spent at all under Bush, and 90% of what was spent was repaid as of two years ago. All in all, much better than anyone anticipated. Yet, it was Paulson's demand for a $700b slush fund that broke the psychological limit, now we all throw around trillions and think nothing of it.
1 year ago
1 year ago Link To Comment
Don't forget TARP. It was designed to be repaid, and most that wasn't diverted into the auto industry black hole by Obama has been paid back.

Bush gets the credit for the money going out--raising his spending figures.

Obama gets the credit for the money coming back in--lowering his spending figures.

Both sides of that--except Obama's diversions of the money--should get credited to Bush.
1 year ago
1 year ago Link To Comment
God willing, he may be right about things being better by 2018. With any luck, which we seem to have been short on lately, enough people will come to their senses in 2014 and hold on through 2016. If we can get enough true conservatives elected in 2014 to hold on and then get a good conservative candidate for President and a majority in Congress in 2016 we may survive. At least that is what I keep telling myself as I stock up on reloading supplies.
1 year ago
1 year ago Link To Comment
Now we have Obama's (and possibly Rubio's, though I am hoping he at last has seen the light) push to soon legalize illegal immigrants and right now to stop enforcing our immigration laws (another reason for impeachment proceedings). This is a fertile field for the propagandists in the media to graze in.


One wonders though, will our current King wish to extend an open border only to Mexicans? What will happen if those from Muslim lands who hate us, but will disguise their hate as they covet entry and secretly hope and plan for Sharia, will use Mexico for a doorway into the U.S.? Will they have to be admitted and added to the welfare rolls for the edification of the always crazy-generous libruls?
1 year ago
1 year ago Link To Comment
I think events in 2014 will steadily overtake this administration and the Beltway Ruling Class. ObamaCare is a much more serious drag on our national economy than people now realize. The political fallout beginning in Jan 2014 will just be the beginning. Additionally, our economy is only one small crisis (banking, real estate, energy shock, etc..) from recession. QE barely keeps things above water (1.8-.5% GDP growth). And then there is foreign policy...

The President and his party will not have the time to devise some grand political scheme to force amnesty or win the 2014 mid-terms. Gun Control is also DOA. Despite what the Beltway Class says, the President is a Lame Duck with dwindling political capital. He didn't even have enough mojo to get stricter federal gun control laws, despite a huge assist from the MSM.

These last 2 years, I predict, will be so bad for the President that he will begin making his departure plans as early as July 2014.
1 year ago
1 year ago Link To Comment
"events in 2014 will steadily overtake this administration and the Beltway Ruling Class..."
------------------------------------------------------

If by that you mean the electorate will rebel against them - Bull!

I bought into that 'events will show the American people' stuff in 2009 after the largest heist in American history - to the tune of nearly one trillion bucks - and what happened in 2010? Well - not the 'landslide' most of us predicted eh? Come 2012 and we were all hoping that American voters would suddenly come to their collective senses and bounce these crooks from office. What happened? Not much. The progressives still hold sway in the Senate - and the House is having more than it's share of problems as the in-fighting only gets worse among republicans. Not a very good turn of events.

Skip forward to the present with articles such as those on the LAT. The payoff for the progressives' takeover of the American educational system is paying off in spades. Many LIV's can't read and those who can probably can't add and subtract. The MSM is a propaganda grist mill for the progressive wing of the democrat party - that isn't going to change. LIV's aren't going to suddenly be able to read and process simple math problems - nor are they likely to suddenly become fluent in logical thinking - thats a plus for the progressives and RINO's.

See what we are up against?

Now - tell me again how the 2014 elections are going to pan out?



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1 year ago
1 year ago Link To Comment
Those events of 2009 went largely unnoticed, because they didn't hit people directly. Obamacare will. You're comparing apples and oranges. Sure, it won't be a permanent wake-up call, but it's sure going to hurt Dems in 2016; 2014 may be too soon, as not all of Obamacare will be implemented yet.
1 year ago
1 year ago Link To Comment
It could be worse if the world did not have the Web; We would not know
about the lies until the world economy collapsed, and would not be able
to prevent it or prepare to survive it.
1 year ago
1 year ago Link To Comment
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