Friday, September 18, 2009


National Debt Road Trip - Watch more Funny Videos


  1. Anonymous6:08 AM

    Ha! Witt - if you posted this to draw me out of my Beijing shell... well, it worked! Allow me to offer a rebuttal:

    In one sentence:

    This video is highly misleading in that it implies future deficit is because of Obama - which is wrong, it's due to structural deficits that Obama is trying to address.

    In many sentences:

    Cartoons are fun, but... this one didn't strike me as intellectually honest or academically rigorous.. quite simply - it infers that the future deficit is a result of Barack Obama - which it's not... not to mention that it's a strange accusation, right? He's been in office 9 months - and outside of the stimulus package hasn't passed any big spending programs.

    The cartoon doesn't say why or where the debt came from - but the future deficits are structural and would be *predicted* to happen regardless of who was President right now. So where did the *projected* deficit come from?

    In a simple list:
    1. How much of this is a result of structural budget deficits (i.e. would have happened under any President)?
    2. How much is a result of Bush policies?
    3. How much is a result of new Obama spending?

    It seems to imply it's all #3, and not #1 or #2.

    Of course analyzing future deficits is hard - projecting economic growth, predicting future reforms, future budgets, etc. But what about the current deficit?

    A few facts:

    1. Much of the current deficit is *a direct result* of Bush policies and the economic downturn. It is *not* from new Obama spending. Remember, Bush inherited a surplus, Obama *inherited* 1.3 trillion dollar deficit. Repeat, *not a result of new Obama spending.*

    2. Obama is working to reduce the future deficit - his *first* budget *reduced* the projected deficit by *2.2 trillion* dollars over ten years. And Obama himself said that "this isn't good enough." Obama has consistently shown a commitment to getting the deficit under control.

    3. An example of his commitment to addressing structural debt and to fiscal responsibility is health care reform. Addressing health care is *key* to addressing the future deficit. Why is Health Care so hard to pass? In part because Obama wants to make it deficit neutral - i.e. he wants to *pay for it* - which is hard. When Bush passed health care reform (prescription benefit program) - it was *unfunded* i.e., was funded through deficit spending. We don't know what health care reform will look like yet, but the current plan in the Senate would *further reduce the deficit*.

    4. And just to punch back a bit: Wasn't it Dick Cheney who said, and I quote, "Reagan proved that deficits don't matter." Perhaps we should add the caveat: "When Republicans are in control."

    As far as I can see - Obama recognizes the future deficits and is working to fix them. Of course, it's been now, what, 9 months? But again, Bush and the Republicans had control over congress for much of Bush's term and did nothing to curb spending. That's a fact. They had a chance - and spending shot up sharply, the deficit spiraled, and little was done to address long term structural debt.

    Blatantly dishonest videos/essays/etc. get my Irish up - if I met the creators of this little work, I'd tell 'em their video's concluding analysis should be reversed - The Republican party, largely, didn't say a peep when they were in control and spending and deficits got out of control, but now that a Democrat is President, suddenly they're worried about deficit spending! Surprise!

    For a more even handed look at the deficit, see here:

    Sorry to make my first post from Beijing one on politics! I've sent a few emails out, but quick summary - I'm well settled in, taking close to 4 hours a day of class, spending a lot of time studying, and doing my best not to eat organs (lungs, heart, intestines, gizzards, ...).

  2. Anonymous2:47 PM

    A few comments/questions.
    1. Is overspending in the past a solid justification of overspending in the future? Bush increased the national debt by 20% in 8 years(measured as a % of GDP). Obama's currently projected to increase it by 42% (lso measured by as a % of GDP) in 4 years.
    2. Obama "working on reducing future deficit" is not a fact that has any real relevance to anything. Presidents of past and future have worked and I am sure will work on many things that either never came to fruition or where accomplished but only to the determent of the country and the people.

    For example Bush talked about reforming social security something that was never accompolished, does that mean I should be happy with Bush because he talked about it?

    3. Your example of Health Care Reform is a good example to highlight a point you made early in your post, that projecting economic growth, predicting future reforms, future budgets is difficult. In your *Fact* you state that the current plan in the senate WILL FURTHER REDUCE the deficit, like myself many others out there are to say the least a little sceptical of this particular *Fact*(really a projection by some).

    The only real value of projections and cartoons that use them that I can see is to raise awareness of the course we might be on so that if we wish to change the course of action in order to prevent what could happen we can. For that purpose sometimes exaggerated cartoons can be beneficial (which of course is a relative term).

    Only time will tell if Obama does in fact reduce spending and deficit, and prevents us from building a deficit that runs at 100% of GDP as projected. In 9 months he has as you pointed out only spent or flagged between 600 and 800 billion on ARRA as you trivialized in your response.

  3. Also forgot to include this in the post. There is a good back and forth on this very topic in an Economics blog I read by two experts in the field.