Republicans or Democrats … Who Does Debt Best?
By TLB Contributing Writer: Ryfka
Debt has garnered a rather negative reputation over the years. However, the absence of debt could lead to a dramatic slowdown in economic growth. Consider that the US economy is comprised of 70% consumer purchases, and this is precisely what fuels the engine of the world’s #1 economy. The debt ceiling is a term that is often bandied about in the media. It refers to how much the government has available to spend, and what it needs to borrow in order to keep the government open for business. The debt ceiling has been raised multiple times over the years, and it is none other than Ronald Reagan who increased the debt ceiling the most.
Wars Have Drained Government Coffers
According to the Guardian newspaper, Reagan increased the debt ceiling 18 times, followed by Lyndon B. Johnson (10), Jimmy Carter (10), George Bush Sr (9), Richard Nixon (8), Gerald Ford (7), George Bush Jr (7), Barack Obama (6) and Bill Clinton (6). It is surprising that the correlation between the number of times the debt ceiling has been raised during a presidency, and the overall level of debt is a lot more complicated than meets the eye. For example, the federal debt held by the public was highest during the reign of Democrats between 1931 and 1951. Various Democrat presidents including Franklin D Roosevelt, and Harold Truman presided over the highest ever debt levels at the time. It must be said that the economic figures were skewed because of the aftermath of World War I, the 1929 Wall Street crash,, WWII and the rebuilding of the global economy. Many of the problems that the economy faces are not related to either Democrat policies all Republican policies.
The rampant debt in the years between 1931 in 1951 is directly attributed to war and the economic recession that resulted when men were drafted into military service and pulled out of the workforce. War is a money spinner, but it’s also a major drain on the economy. It is also notable that debt levels plunged when Eisenhower took office and the Republicans controlled the House and Senate in 1953. Debt started rising once again in the 1980s when Ronald Reagan and George HW Bush assumed the presidency and Republicans briefly had control of the Senate. During George HW Bush’s presidency, the Iraq war broke out and the national debt started to rise.
Clinton brought down the national debt, with help from a GOP-controlled House and Senate. Under President Barack Obama the national debt grew at an alarming rate. This is evidenced by the rise from $10 trillion to $19.5 trillion between 2008 and 2016. Indeed, the CBO Treasury Department confirms that there was a 120% increase in debt during Obama’s term in office. That Trump managed to increase the national debt by just $600 billion during his first year in office is remarkable given that Obama increased the national debt by approximately $10 trillion over 8 years. Of course, the policies that were put into place resulting in higher debt were not Obama’s fault. Congress is responsible for the purse strings, and president simply signs whatever bills he and Congress have agreed upon. The recession was largely responsible for increased spending and debt, and that had precious little to do with Barack Obama.
Presidents Don’t Spend: Congress Authorizes Expenditure
Remember that Congress and the Senate must agree on proposals for new legislation before these bills end up on the president’s desk awaiting signature. Overall, there is a lag effect in play at all times. It’s never entirely one president’s fault – it is often a delayed reaction response that we are seeing unfolding while a president is in office. It may well be that Trump’s 4 years will be marked by the economic prosperity as a result of policies adopted by his predecessor, Barack Obama. Nonetheless, it is clear that there has been an increase of debt over time, as evidenced by the $20.6 trillion national debt. There are many ways to mitigate this debt, but government bureaucracies tend to be in the business of expanding their budgets, not trimming the fat.
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