In 2010, Republicans held up a health-care bill for 9/11 first responders because they thought its $7.4 billion price tag was too much at a time when the deficit was over $1 trillion. “Every American recognizes” their “heroism,” then-Sen. Tom Coburn (R-Okla.) said, “but it is not compassionate to help one group while robbing future generations of opportunity.”
In 2011, Republicans threatened to force the government to default on its debt if the Obama administration didn't agree to $1.2 trillion of spending cuts over the next 10 years. This budgetary game of Russian roulette was worth playing, then-congressman and current White House budget director Mick Mulvaney argued, because “we are going to default sooner or later if we don't change things.” In other words, continuing to run deficits would — allegedly — lead to a default, so we might as well risk a default to stop running any more deficits. (Never mind that investors disagreed so much that they were willing to lend us money at lower rates for longer times than almost any other time before).
And so, of course, in 2018, Republicans are doing more to add to the deficit when unemployment is 4.1 percent and falling than Democrats did in 2009 when it was 8.3 percent and rising. That, the New York Times's Jim Tankersley found, is what President Trump's $1.5 trillion tax cut and the $300 billion spending deal Democrats and Republicans just agreed to will mean the next two years.
This is at once shocking, but not surprising. Shocking because this is the worst possible policy — Republicans support stimulus now that the economy doesn't need help but didn't when it did — but not surprising because this is who they've been for a long time now. Indeed, Republicans have shown us over and over and over again that they don't actually care about the deficit. They only say they do when they're worried that Democrats are about to redistribute more money from the rich to the poor. As soon as they control the White House, they go back to doing what they have for 40 years now: cutting taxes for the rich and increasing spending on the military, no matter how much red ink piles up. It's what Ronald Reagan did in the 1980s, what George W. Bush did in the 2000s and what Trump is doing today.
The only difference is that it makes even less sense now. During a downturn, you see, deficit spending, particularly on things like food stamps and unemployment insurance, doesn't just give people a desperately needed lifeline. It also puts money to use that the private sector won't, keeping the economy from falling any further. This logic doesn't hold, though, when the unemployment rate is already at an 18-year low of 4.1 percent. In that case, deficits just tend to push interest rates up and “crowd out” private investment, as the government and private sector compete for limited funds. While it's true that this effect might be muted right now because of the long shadow of the Great Recession, it's still enough of a concern that people who believe in deficit spending shouldn't believe that now is the time for increasing them. Instead, we should be trying to cut them to the point that our debt burden is going down. No less a Keynesian than John Maynard Keynes himself would agree. "The boom, not the slump," he famously said, "is the right time for austerity."
Unless, of course, deficits were never really your concern, and the point has always been tax cuts for the uber-wealthy and military largesse.
Now, to try to get a better idea of what Republican and Democratic presidents have done to the deficit while in office, I calculated how much every administration has added or subtracted to it the last 30 years. This isn't quite as simple as it sounds. You can't just look at how much it went up or down, since a lot of that has to do with the state of the economy. After all, people have more money to pay in taxes when things are going well, and don't need as much help from the government then either. The deficit, then, tends to rise and fall with the unemployment rate — but only tends to. A big tax cut, for example, could send it up regardless of everything else.
That's what we're really interested in: How much the deficit has changed because of things the government has done. And we can get a sense of that from the projections that the nonpartisan Congressional Budget Office puts out every few months. They not only estimate how much the deficit picture has changed since last time, but also how much of that is because of new legislation. In general, we'd hope that this would also go up when unemployment does and down, too.
That's advice that Trump isn't following. The easiest way to tell, if you look at the chart below, is that no other president has added so much to the deficit when unemployment has been so low. In fact, he's adding more to it than George H.W. Bush did when joblessness averaged 7.5 percent, more than Bill Clinton did when it averaged 6.9 percent, more than George W. Bush did when it averaged 5.8 percent and more even than Barack Obama did when it averaged 9.3 percent.
But again, this isn't just a story about Trump. It's a story about the Republican Party. The CBO doesn't have these same numbers for the Reagan years, but if it did, you'd see the same pattern that you do for the George W. Bush and Trump ones: a big military buildup and even bigger tax cuts for the rich that lead to big deficits in both good times and bad. The only exception to this was the George H.W. Bush administration, which, following eight years of red ink, had little choice but to raise taxes and cut spending, no matter what his lips had said. This, of course, set off a conservative revolt that helped doom the elder Bush's reelection and, as a result, turned the GOP's anti-tax faith into dogma.
It's left us with a depressingly predictable politics. Whenever a Democrat is in the White House, Republicans propose very specific tax cuts, very vague spending cuts and very unrealistic Medicare vouchers, so that, after a period of self-flagellation for their prior fiscal sins, they can pose as deficit hawks once again. Professional centrists promptly swoon and shower Republicans with awards, like they did with Speaker of the House Paul D. Ryan back in 2011, for their supposed bravery. So what if their plans don't add up. At least they're “starting a conversation.”
It's one that lasts until a Republican is president. At that point, the spending cuts they didn't want to name never materialize, and the tax cuts they couldn't wait to make do.
But don't worry. It won't be long until Republicans bemoan that “both parties have squandered the public's trust” and need to change course before Washington “buries the next generation under an avalanche of debt.” (That's what Ryan wrote in his 2012 budget). It's coming in either 2021 or 2025.
You know, the next time there's a Democratic president to start running against.