Bush vs. Obama Spending the Truth

"Bush vs. Obama"

Click here to read a short analysis on the costs for 2010.

It seems as if there has been enough political propaganda in the past 4 years to really become lost between facts and lies. I can’t guarantee  you any sort of absolute truth, but what we have available is a certain level of information, which can be dissected to ascertain a level of truth.

A big political and economic topic; Obama is spending at record levels. Some are saying Obama has spent more than Bush in 1 year, and the rising and unstable federal deficit is now Obama’s fault completely. Two years ago everything was Bush’s fault, because of war expenditures. So which is it? Is there any truth to any of these claims?

How much has each president spent every year and how has the federal deficit been affected?

Let me disclaim, I made it a point to try and be statistical without bias (never truly 100% possible). I am not able to capture every variable and create some magical algorithm that can settle all the political arguments about our federal debt. What I can do is provide you with some factual data, which may help support or shape your opinion.

Below are the numbers through 2009. * 2010 has not concluded and I did not want to use estimated numbers (at the time this was written).

Fiscal Years 2000 to 2008

Year GDP-US$ billion Total Spending-fed$ billion Federal Deficit-total$ billion
2000 9951.5 1789.22 a -236.24 a
2001 10286.2 1863.19 a -128.24 a
2002 10642.3 2011.15 a 157.75 a
2003 11142.1 2160.12 a 377.59 a
2004 11867.8 2293.01 a 412.73 a
2005 12638.4 2472.20 a 318.34 a
2006 13398.9 2655.44 a 248.19 a
2007 14077.6 2728.94 a 160.94 a
2008 14441.4 2982.55 a 458.55 a


Spending increased every year through 2008. $730 billion of that spending was attributed to military expenditures. That is about 24% of the government spending. It is safe to assume that the war was a significant contributing factor to the massive deficit. The seven years of high war costs are part of the Bush administration, not Obama. This is obviously a significant factor in understanding the countries path to a large federal deficit.

For clarity, Bush did fund the wars through emergency supplemental’s (not the regular budget process), but the spending is reflected in the numbers above.

Now, we have one full year of factual numbers to dissect Obama’s spending. Let’s take a look at the numbers. Some argue that the spending was passed in 2008 under President Bush. Government budgets are flexible and spending can be changed through legislation at any point. This is important to remember when considering that 2009 budgets derive in majority from 2008 (Bush term).

Year GDP-US$ billion Total Spending-fed$ billion Federal Deficit-total$ billion
2009 14601.4 3517.7 a 1412.7 a

These are the final reported numbers by the CBO. Many readers confuse debt numbers with deficit numbers. If it seems that this deficit number is to low, you are probably confusing the two. Please take a minute to research the difference between the two. 

Obama spent approximately $535 billion more year-over-year then Bush’s highest year of spending. Because of the continuing recession and slowed GDP, the deficit increased by a staggering $960 billion in 1 year.

$794 billion was spent on military expenditures, more than in 2008 while Bush was still president. That cost is almost a wash, but it is a surprising number considering the anti-war stance Obama drove during his campaign.

I also do not want to confuse the reduction in federal revenue with the increase in our federal deficit. This would be unfair to Obama in comparing his spending to Bush’s spending. Rising unemployment and slowed GDP lead to less tax revenue which also increases the federal deficit.

Obama spent the following in new legislation in 2009.

-       TARP Program – $154 billion (money spent during Obama’s administration but passed under Bush)

-       American Recovery and Reinvestment Act – $202 billion

-       Omnibus Spending Bill – $410 billion

This represents about $766 billion in spending directly attributable to the increase of $960 billion in the federal deficit. With the increase in military spending, that leaves about $140 billion left, which can presumably be attributed to inflationary budgetary expenditures (originally from the Bush office) and reduced revenue from the economic recession. Recessions and high unemployment add to the deficit because they result in less tax revenue as explained above.

The spending in 2009 was high. The war spending struck me as interesting because Obama’s political stance during the election was to minimize current war efforts, not increase them. No legislation was passed in 2009 to reduce this spending. In Obama’s defense, the Congressional Budget Office (CBO) in 2001 estimated an $850 billion surplus by 2009. The actual numbers have taken a $2.2 trillion dollar swing. Because we are comparing 8 years of the Bush administration against 1 year of the Obama administration, Bush obviously accounts for a larger portion of that swing. The Bush administration’s policy must take responsibility for the majority of the negative swing in the deficit. They handed the Obama administration a “hot potato” and it hasn’t cooled.

With a heavily skewed analysis (8 years of data vs. 1 year), you can argue that the spending on an annualized basis is a more accurate representation of spending.

Looking at 1 year against 8, Obama has had a significant short-term impact in spending the country into what is considered an unstable federal deficit. Historically, economists claim that increased spending helps take an economy out of a recession. The question seems to be,what is the cost and how much spending is appropriate? There isn’t a graph advising leaders on how to effectively follow that methodology.

To conclude, it seems that both Presidents are to blame for leading the country into a large federal deficit. The cumulative cost of the military contributed greatly to handing Obama a $460 billion deficit instead of a $850 billion surplus. Unfortunately, instead of cutting spending, Obama has spent more money than the government has ever spent in a single year and contributed to the substantial federal budget deficit increase. We are now at the highest deficit levels compared to GDP, second only to World War II. Obama may take note of that, but in 2010 he continued passing legislation that increases expenses through the next decade.

Fiscal policy will need to change at some point, revenues will need to be raised through taxes and jobs, and spending cuts may need to compliment this.

So what is the answer to the million (trillion) dollar question? It doesn’t seem accurate to say Obama has spent more than any other president ever or combined. It does seem accurate to ascertain that he has contributed to the federal debt and deficit at levels never see before in a single year. This of course comes with its share of mitigating and aggravating arguments. The problem that faces us today is not all Obama’s fault, and it’s not all Bush’s fault, it’s the compilation of two offices that have spent recklessly and  left people wondering about the health of our financial future. To conclude the original point, those chain emails are wrong, Obama has not spent more than any president ever. Not yet at least.

Note – Actual numbers come from the Congressional Budget Office. Many factors are not considered. The intent of this literature is to simply analyze the truth behind the spending and increase in the federal budget deficit based on actual data from 2001 – 2009.

Author statement- I am truly flattered by some of the major publishers who have cited this article. I should stat that I have my own political views like everyone else and I am making no excuses for either party (bipartisan cop-out). I hope everyone, no matter what political view they have, can take something from the outlined data. Feel free to express your opinions or present data that further drills into the topic. Comments insulting others or insulting the content won’t be approved.  Just keep it clean and feel free to comment. Thank you.

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