Regardless of what you’re being told, the deficit is due to Bush’s tax cuts, not Obama’s stimulus spending

Ann Arbor-born economist and historian Bruce Bartlett, who served as domestic policy advisor to Ronald Reagan, and in the Treasury under George H.W. Bush, joined Chris Mathews on MSNBC’s Hardball yesterday, talking about the true origins of our nation’s current deficit. It should be required viewing for all Americans… Here’s the video, followed by an excerpt from the transcript.

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MATHEWS: Bruce Bartlett is former Deputy Assistant Treasury Secretary under the first George Bush and a policy adviser to Ronald Reagan. Bottom line, let’s look at the numbers right now. We’ve got a chart coming up. This shows the Bush tax cuts were responsible for increasing the debts. Now, we have about a $14 trillion debt right now, half came out since the turn of the century, and more than 40% of that has been from tax cuts.

BARTLETT: That’s right. When Bush took office, we had a debt of about $6 trillion. The projections from the CBO were that we were going to run a $6 trillion surplus. By this point, if we had done nothing, we would have paid off the dead debt, but we added about $3 trillion of tax cuts. We lost about $3 trillion of revenue because of the slower economy and added about $6 trillion of spending, largely due to two unfinished wars, Medicare drug benefits and a lot of other things. So, instead of getting — paying off the debt — we ended up with about a $14 trillion debt.

MATHEWS: Some of these clowns, not all of them, running around saying Barack Obama is a Socialist, he drove up the national debt to $14 trillion and dance around in a circle and congratulate each other. That’s not true.

BARTLETT: No, I think the dirty secret is that Obama is a moderate conservative. If I were a liberal democrat, I probably would be upset.

MATHEWS: The point is a $1 trillion debt, and another… is from the prescription drug bill. The rest of that is from a lousy economy under Bush and these two wars he came up with.

BARTLETT: That’s right. The Republicans keep saying the tax cuts are the key to prosperity. The 2000’s are evidence that that is not true. We had booming economies in the 1980s and ’90s. If we went back to those taxes, we would be better off.

MATHEWS: What is the argument against the kind of tax policy– let’s just say it again. It seems like a heck of a great economy with the tax rate of about 39.6, as opposed to 35?


MATHEWS: That’s the ones the rich bitch about, to use a crude term. That helped balance the budget.

BARTLETT: That’s right. Don’t forget that Ronald Reagan raised the capital gains rate, and now it’s only 15%, and of course the wealthier you are, the more of your income comes from capital gains.

MATHEWS: We showed the 400 richest people in the country. They pay about the same as a poor person pays, about 18%.

BARTLETT: That’s right – of income taxes – that’s right.

MATHEWS: Whereas the middle class, who think they are the majority of the country, they’re paying a higher rate.

BARTLETT: That’s right. I don’t think there’s any question that there would be positive economic effects if we went back to those tax rates.

MATHEWS: How come I need to drag you on the show — the fact is, just a simple math, we have a $14 trillion debt, half came from the Bush era, almost, and the rest came from the prescription drug bill, and with a terrible economy and the two wars that he promulgated. That’s simple math there.

BARTLETT: That’s right, but in the Republican playbook, of course, the deficit is never caused by tax cuts…

And, here’s that chart that they were mentioning, which clearly shows why we’re in the state we’re in, and who’s responsible.

Now, if we could just get ourselves a leader who could could fight for the following three things…

1. End the Bush tax cuts.
2. Allow Medicare and Medicaid to negotiate for lower prescription drug prices.
3. Begin the process of ending the Bush wars, and trimming the military budget.

If we could do just those three things, our country would be back on the path to prosperity. But, of course, it won’t happen, as everyone knows that our country is going bankrupt because of that damned Socialist in the White House and his insane spending on the poor, right?

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  1. Bob
    Posted July 28, 2011 at 9:33 pm | Permalink

    And yet the great communicator in the White House, the Constitutional law professor, can’t articulate this in simple terms to the American public. Neither can the well-educated Congressional Democrats. Why they are unable to create simple talking points, and hammer them home relentlessly as the GOP does, is beyond me. This message should be a 15 second campaign ad, running constantly on television and radio.

  2. Posted July 28, 2011 at 9:41 pm | Permalink

    Some are doing it, Bob. It’s just that no one listens. People have been trained to tune out the crazy, “Socialist” ramblings of Kucinich and Sanders long ago. As for the rest, I’m not sure. Maybe they’re terrified of crossing the people in the corporate board rooms who wield the real power. Or, maybe, despite the D’s next to their names, they don’t really give a damn about the American working class. I suspect, for the most part, though, they just don’t want to be voted out of office, like Russ Feingold and Alan Grayson. People in power want to keep it.

  3. Posted July 28, 2011 at 10:16 pm | Permalink

    It’s challenge enough trying to get people to understand that Bush signed TARP into law.

  4. Edward
    Posted July 29, 2011 at 6:43 am | Permalink

    It’s challenge enough trying to get people to understand that 9/11 happened during the Bush administration.

  5. Mr. X
    Posted July 29, 2011 at 6:55 am | Permalink

    You sound like that socialist Dennis Kucinich, who said pretty much the same thing yesterday.

    “Here is how to get out of debt: End the wars–save a trillion over ten years. Repeal tax cuts to the wealthy–save another trillion. Medicare for ALL, ending the four hundred billion yearly subsidies for health insurance industry.”

  6. Anonymous
    Posted July 29, 2011 at 8:02 am | Permalink

    I put this in the Open Thread, but it probably belongs here as well.

    Boehner withdrew his plan as it didn’t look he had the votes in the House. His plan, according to the tea partiers was “too left wing”.

    Don’t worry about the House’s failure to vote on John Boehner’s debt plan Thursday night. That’s Boehner’s problem, not the country’s. True, I suppose we should devote a moment to reflecting on how terrible it’s gotten when a speaker with a lifetime rating from the American Conservative Union of 94 can’t pass a bill in his own party because he and it are “too left wing.” But if anything, a defeat for Boehner, today or whenever, would increase the likelihood that Mitch McConnell would have to play ball with Harry Reid and let Reid’s proposal serve as the framework for a deal, so a Boehner defeat would be fine.

    What this will come down to is the same question it was always going to come down to: How many Republicans in the House of Representatives are willing to take the country down in their desire to see Obama defeated?

    That’s the only important question here, politically speaking. The Senate is probably capable of working something out, since it’s in Democratic hands. GOP leader Mitch McConnell is an obstructionist and self-avowed Obama hater, but he’s probably not out there in tea-party land. The question is and always has been about the House.

  7. Posted July 29, 2011 at 8:26 am | Permalink

    Wow, you know it’s bad when an asshole like Boehner is “too left wing.”

    This hijacking of the right by the extreme right is troubling in so many ways, not the least of which is the ability to get things done. The worst part, though, is the silencing and exclusion of centrist and moderate Republicans.

    Next year’s elections are going to be really interesting.

  8. Demetrius
    Posted July 29, 2011 at 9:02 am | Permalink

    “Next year’s elections are going to be really interesting.”

    Does anybody else besides me get the feeling that the upcoming elections might be the last ones we see for awhile?

  9. Tom
    Posted July 29, 2011 at 9:39 am | Permalink

    Crude. Political. Theatrics.

    Both parties have accepted the practice of ‘borrowing’ money from the rich, no questions asked. Who do we think we’re actually ‘indebted’ to anyway? The wars are funded on credit. Stopping them is not the whole story. The other half is to not even pay back what should have been taken in the first place. And then take the rest because rich people do not ‘deserve’ to be rich.

    Yes, doing what seems so simple is complicated. But I’m not playing this ‘Bush tax cuts’ game.

  10. Glen S.
    Posted July 29, 2011 at 9:48 am | Permalink

    Mark, the chart you’ve posted really helps to put the current “debt ceiling” debate into perspective.

    Here is another chart that does the same for the nation’s unemployment situation:

  11. Anonymous 2
    Posted July 29, 2011 at 10:37 am | Permalink

    What “game” are you talking about, Tom? Are you suggesting that the Bush tax cuts for the wealthy didn’t happen?

  12. Tom
    Posted July 29, 2011 at 12:36 pm | Permalink

    Well, Anonymous 2, I’m suggesting unless ‘Bush tax cuts for the wealthy’ fits within a broader program to rollback the cuts that occurred under Democratic presidents as much as Republicans, it will prove to be a diversion. The point is to expand consciousness of a 40-year package of privatization, tax cuts, borrowing, and bailouts. A package of policies that have been accepted by Democrat and Republican alike.

    The point is to reveal basic assumptions about democracy and capitalism.

  13. Meta
    Posted July 29, 2011 at 1:46 pm | Permalink

    Breaking news on the Debt Ceiling talks:

    The House of Representatives could vote on final passage of Speaker John Boehner’s debt plan between 7 and 8 p.m. ET today, according to a House Republican source. But the source cautions that time could be moved to later.

    Republican leadership in the House had scheduled a vote Thursday night but canceled it after it became clear there weren’t enough votes to pass the measure. Conservative House Republicans, many elected with tea party support, had opposed the plan because they said it didn’t cut enough federal spending or contain a requirement to balance the federal budget.

    The speaker is trying to make the plan more appealing to conservatives by including a provision requiring congressional passage of a balanced-budget amendment before the debt ceiling is extended through the end of 2012, according two GOP House members. Senate Majority Leader Harry Reid had said he had enough votes to table the measure in the Senate, effectively killing it.

  14. Meta
    Posted July 29, 2011 at 1:54 pm | Permalink

    From Obama today:

    And make no mistake -– for those who say they oppose tax increases on anyone, a lower credit rating would result potentially in a tax increase on everyone in the form of higher interest rates on their mortgages, their car loans, their credit cards. And that’s inexcusable.

  15. Posted July 29, 2011 at 3:12 pm | Permalink

    Not to mention a devaluation of the dollar, which will drives prices of just about everything up.

  16. Alf
    Posted July 29, 2011 at 3:35 pm | Permalink

    But it won’t be a god damned socialist making them pay more, Peter. It will be the free market, mother fucker!

  17. TaterSalad
    Posted August 1, 2011 at 6:50 pm | Permalink

    Can someone actually tell us what Capt. Bullshi_, better known as Barack Obama has accomplished as President or better yet, as a community organizer?

  18. Alan
    Posted August 2, 2011 at 8:02 am | Permalink

    “America has one political party, with two right wings”.
    — Gore Vidal

  19. Alan
    Posted August 2, 2011 at 8:06 am | Permalink

    TaterSalad: your link is a bunch of moronic right-wing bullshit. The amazing thing is that such morons think that Obama is somehow on the left! Just like progressives want to imagine that Obama is somehow “progressive” — at heart, if not in deed. The extent of the delusion is breathtaking.

  20. Mr. X
    Posted August 2, 2011 at 8:09 am | Permalink

    Alan, don’t waste your time with Taters. A box fell on his head in the Walmart warehouse, and he lives in his parents’ basement, collecting disability, and ranting about others who find themselves in similar situations. Believe it or not, despite the considerable evidence to the contrary, he still believes that Obama is a Socialist. In other words, he’s a lost cause. So, my advice to you is just to ignore him.

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