The Obama deficits...

[kentuck]

We were sinking to 6500 in the stock market and there was severe deflation. There were major worries that people would stop spending altogether. We were headed quickly toward a depression.

In order to counter this severe downturn, they did the only thing they knew would work - a heavy dose of Keynesian economics. That was the purpose of the huge "Stimulus Bill". There is little doubt that the stimulus and the bailout of General Motors did much to keep us from going off the cliff that the Republicans had led us to.

That is why the deficit is large now. However, we cannot forget that George W Bush doubled the debt in eight short years. Never in our history had we had such a huge turnaround from surplus to debt. Bill Clinton had left Bush and the Republicans a surplus of $260 billion dollars and a projected surplus of $5 trillion dollars. Bush turned that into a $5 trillion dollar debt and left a deficit of about $1.3 trillion dollars to President Obama, along with the worst economy since the Great Depression.

The Obama deficits are different from the Bush deficits in they were intentionally created to stimulate the economy, unlike the Bush deficits, which were created to give big taxcuts to his friends and to drive our economy into the ground. Is this too complex for "tea-baggers" to understand?

[IndianaJoe]

1. The Bush Administration was an unmitigated disaster

for the United States. We should remember that; remember what Obama and the Dems were left with when Bush exited. It will be many years before the damage that that bunch did will be repaired.

We also need to remember that we can't ever let something like the 8 years of Bush happen to us again.

[Pirate Smile]

2. Part of it is also the huge decline in taxes paid that happens when so many people lose jobs,

businesses close their doors, etc.

That is a very large number of people who are no longer paying in what had been considered the normal amount of taxes (just think of the standard amount in each check for Social Security and Medicare multiplied by millions of people). The $$$ coming in plummeted at the same time the $$$ going out needed to skyrocket. That combo is going to lead to a large deficit but it is preferable to the spiral downward that would happen if the government didn't spend $$$ to prop up the system because without it even more people would have lost jobs (over 2 million) leading to even less coming into the treasury.

Tax receipts to the government hit bottom and are heading back up which is another sign of recovery.

[kentuck]

3. 8 million unemployed would affect the deficits...

I remember a few years ago where someone estimated that for each point of unemployment costs about $25 billion dollars? I don't know if that number still holds?

[Spoon]

4. Debt interest

The real problem will be the interest on the debt, which will eat up any increase in taxes collected by the Treasury from the recovery. 2007 and 2008 it was about 250 billion each, 2009 was slightly less at 200 billion interest paid, due to record low interest rates. Everyone and their mother, though, is prediction a period of ramping interest rates starting in a couple months. The Fed cannot hold it at near 0 forever, lest another devastating bubble form. This, combined with an increase debt load in general, smells quite bad. Anyone who has ever been in this situation on a personal level knows how evil the debt spiral can be.

[CreatureFeature]

5. GOP: Look at this mess! When is Obama going to clean it up?

[cojoel]

6. and in addition...

The * administration kept the cost of middle east military operations in Iraq and Afghanistan off the budget, thus those costs did not constitute their official deficit. Obama put all costs on budget.