What should the president do Monday? I think Amilya Antonetti, chairman & CEO of AMA Productions, has it right. In a not-to-be-missed interview with Neil Cavuto (h/t Instapundit), she boiled it down to one word: “Apologize.” He should say he’s sorry for his failure of leadership. Sorry for his utopian economic illiteracy. Sorry for putting ideology above political wisdom.
That would be the manly, the honorable thing to do. Admit he was wrong about what needed to be done to fix the U.S. economy.
What will he do? He will blame Standard & Poor’s. Or George W. Bush. Or the Tea Party. Or all three.
About George W. Bush. I have always been of the view that he spent too much money. (“Like a drunken Democrat,” I used to say: little did I know what was coming.) In my view, Medicare part-D (“Prescription drugs for seniors”) is a piece of feel-good fiscal irresponsibility that ranks up there with the epic disasters perpetrated by Lyndon Johnson. Indeed, the whole agenda of “compassionate conservatism” is redolent of a certain species of rancid idealism. It’s what happens when people of generally conservative disposition find themselves seized by a failure of nerve and, desperate to calm themselves, adopt the protective coloration of a liberal on one or another issue.
But, spend as he would, George W. Bush is not the reason Barack Obama will go down in history as President Downgrade. Really, no one cares that he is the first (partly) black president. (Besides, if Toni Morrison is right, Bill Clinton copped that prize.) The “first” that will be his legacy is this: he was the first president in our history to preside over a downgrade in the credit worthiness of the Untied States of America.
“Oh, but I inherited a mess from George W. Bush.” That’s what the president and his handlers will be saying for decades.
Let’s take a look at what he inherited from President Bush. Byron York, in the Washington Examiner, has the numbers. First, let’s look at the revenue side of the equation:
Revenues fell in Bush’s first two years because of a combination of the tech bust and the start of the tax cuts. But then things took off. After taking in $1.782 trillion in tax revenues in 2003, the government collected $1.88 trillion in 2004; $2.153 trillion in 2005; $2.406 trillion in 2006; and $2.567 trillion in 2007, according to figures compiled by the Office of Management and Budget. That’s a 44 percent increase from 2003 to 2007. . . . “Everybody talks about how much the Bush tax cuts ‘cost,’” says one GOP strategist. “We’re saying, no, they led to a huge increase in revenue.”
Then there is the deficit. This year it is weighing in at more than $1.5 trillion. Here’s what it looked like under President Bush:
After beginning with a Clinton-era surplus in 2001, the Bush administration ran up deficits of $158 billion in 2002; $378 billion in 2003; and $413 billion in 2004. Then, with revenues pouring in, the deficits began to fall: $318 billion in 2005; $248 billion in 2006; and $161 billion in 2007. That 2007 deficit, with the tax cuts in effect, was one-tenth of today’s $1.6 trillion deficit.
“Deficits went up in 2008,” Mr. York notes, “with the beginning of the economic downturn — and, not coincidentally, with the first full year of a Democratic House and Senate.”
“Not coincidentally,” indeed.
What about Standard & Poor’s? Back in April, Timothy “taxes-are-for-little-people” Geithner said there was “no risk” that the U.S. would lose it triple-A credit rating. (A piece of thoughtless irresponsibility, that — any school boy knows that there is always some risk. It was reminiscent of Barney Frank assuring us that there was nothing wrong at Fannie Mae and Freddie Mac.) When the downgrade came, the Department of the Treasury instantly convened a game of spin-those-numbers, claiming that the S&P analysts had based their rating on faulty assumptions and, consequently, that S&P’s projection of government spending was off by $2 trillion. “A judgment flawed by a $2 trillion error speaks for itself,” said a Treasury Department minion.