As a senator, President Obama famously said in 2006, “The fact that we are here today to debate raising America’s debt limit is a sign of leadership failure.” He criticized President George W. Bush for presiding over a $3.5 trillion increase in national debt during his first five years in office.
What does it say about Obama that the national debt has now risen by $8.9 trillion during his presidency?
On Wednesday, total federal debt passed $19.5 trillion for the first time. That’s $168,000 per family, $60,000 per person.
Another way of looking at it is that debt has nearly doubled on this president’s watch, from the $10.7 trillion at which it stood when he was sworn in in 2009. Even to to put it this way — “on this president’s watch” — lets Obama off the hook somewhat, for it suggests a passivity, as though the debt simply rose of its own accord while he sat and watched it. The truth of course is that he has stimulated the ballooning debt with his policies. He didn’t just watch it, he actively made it worse.
By the time Obama leaves office, the debt will likely have risen by roughly the same proportion during his presidency, 100 percent, as it did under Bush. But it is much worse, of course, because in dollar terms it has risen twice as fast.
The ballooning debt is a bipartisan failure, for sure, but the Obama’s lack of leadership on the issue can fairly be judged twice as bad as his predecessor’s. And the attacks he flung at his predecessor now more aptly apply to him.
A case in point: “We now depend on ongoing financial assistance from foreign countries to finance our government’s reckless fiscal policies,” he said in 2006. We now owe $1.3 trillion to China and $1.1 trillion to Japan. To every foreign country combined, America owes $6.2 trillion.
This Labor Day, it is worth considering how rising debt hampers the nation with increasingly high interest payments, which cut what can be spent on anything else. Washington will spend $255 billion on interest payments in 2016, and that number will triple in the next decade. The nonpartisan Congressional Budget Office says that by then, 31 cents of every dollar that workers pay in personal income taxes will go to debt service.
There is no tax hike realistically acceptable that could reverse this trend. According to the Tax Foundation, even if marginal income tax rates were raised by one-fifth across the board, let alone just on the rich, it would increase revenue by only $3.5 trillion over 10 years, even in the highly unlikely event that such a tax hike created no economic downturn.
Which is to say that the federal government has an overspending problem, not an undertaxing problem.
Federal spending is projected to surpass $4 trillion in 2017. Politicians plan to continue living beyond America’s means. By 2026, the federal deficit, the amount of annual red ink, will rise sharply, from $544 billion today to $1.4 trillion.
Congress is also to blame. It appropriates funds before the president can spend them. But as president, Obama has not once proposed a budget that approaches balance. At least congressional Republicans have proposed a budget that balances in 10 years, albeit with some gimmicks.
Obama was right in 2006 that the large increase in the national debt was a failure of leadership. Now, more than 10 years later, the president should look in the mirror and accept blame for having made the problem a whole lot worse.
