Fixing the Budget Starts with Telling the Truth

What a great venue for House Republicans to stage their "Pledge to America." A hardware store and lumber yard. They had to feel right at home what with all the nuts, cranks, cement blocks and loose screws and hinges.

I'm not an economist but I play one at my kitchen table. It's pretty clear we're not going to get out of our long-term budget crisis while all Republicans do is issue platitudes and childish tirades, deny the facts and spend 18 months playing "gotcha" for political advantage, leaving President Obama to struggle with the realities of the worst recession since the 1930s.

As reported by conservative economic columnist Robert Samuelson quoting Mark Zandi of Moody's Analytics and John McCain's 2008 presidential campaign economic guru: "Without government's aggressive response, GDP would have dropped 12 percent instead of 4 percent and 16.6 million jobs would have been lost instead of 8.4 million."

Were mistakes made? Sure. The city was burning down. Sometimes the hoses were pointed in the wrong direction. What can't be denied, writes Samuelson: "The economy and financial markets were in freefall when Obama took office in early 2009. By summer, they were not. Only a rabid partisan can think Obama's policies had nothing to do with the reversal."

Are Obama's trillion dollar, 10 percent of GDP, deficits a big deal? You bet. But there's a difference between short-term deficits to fight the recession and running-up long-term debt.

Republicans need to take responsibility for getting us into this mess with Bush's massive tax cuts, unfunded Medicare prescription drug benefits and two off-the-books wars. Without those the current deficit would be in the range of 5 percent of GDP instead of 9.6 percent.

Contrary to supply-side myth, tax cuts do not necessarily create jobs and increase government revenue. Fourteen million fewer jobs were created under Bush than under Clinton when taxes were higher. And the conservative Cato Institute admits Bush's tax cuts did not raise government revenue. The 2008 tax receipts were the lowest relative to GDP in 40 years.

Despite conservative revisionism, nonpartisan Congressional Budget Office figures show Bush turned a $127 billion surplus in 2001 into a $1.2 trillion deficit in 2009, and the national debt increased from $5.6 trillion (58 percent of GDP) to $12.3 trillion (86 percent of GDP) over his eight years in office.

This is not intended to let Democrats off the hook; just clean up the Republican duplicity. In Obama's parable, Democrats have the car keys now. They've projected a deficit of 3.6 percent of GDP, close to post-War averages, by 2015. If they aren't well on the path of moving in that direction by 2014, there's a 2x4 in some lumber yard that needs to be put to good use.