It was not until that the budget deficit fell to half the inherited level in nominal dollars , if measuring by percentage of GDP. Readers can determine which new costs were justified, and which were not. Conventional wisdom blames the persistently high budget deficits in the Obama years on the unexpectedly weak economic recovery.
To be sure, the —16 economy grew at barely half the 2. That is only half the story. That is the good news. The most expensive bills signed by President Obama did not reflect major policy changes; they were instead extensions of tax cuts that had been scheduled to expire. This includes extensions of the and tax cuts originally signed by President George W. Following a two-year extension enacted in December , the AMT patch and most of the and tax cuts were finally made permanent in January , and many annual tax extenders were made permanent in December After all, a baseline is supposed to show the tax and spending effects of maintaining current policies.
Based on a current-policy baseline which assumes the renewal of existing policies , Obama and Congress actually raised net taxes. The net effect is a tax code designed to raise more revenue from a given income distribution than the tax code. Following an initial surge, discretionary spending proved to be the source of large budgetary savings in the Obama years.
The remaining savings would come from modestly sequestering a small sliver of mandatory spending such as Medicare , as well as lower interest costs. Despite this backsliding, the BCA represents one of the largest spending cuts in several decades. Net deficit reduction does not necessarily mean that the ACA was fiscally responsible.
Given that entitlement spending is on a completely unsustainable path, there is a reasonable argument that the limited supply of realistic spending and tax offsets should have gone toward shoring up Social Security and Medicare, rather than funding a new government program. Instead, Washington added another expensive entitlement to its long-term obligations and reduced the supply of available offsets to address the upcoming deluge of debt.
The task of balancing the long-term budget was made more difficult by the ACA. During the Obama presidency, lawmakers continued to extend the current Medicare physician payment structure as well as extending other small health laws , while often cutting other health-provider payments as offsets thus cutting net spending relative to a current-policy budget baseline.
New presidents typically enter office with a voter mandate for a long list of expensive campaign proposals. Over time, mandates recede, congressional opposition hardens, and gridlock sets in. The Obama presidency was no exception. Nearly all his major legislative successes occurred in and , with the help of large Democratic majorities in the House and Senate. That analysis may even understate the difference between these two periods.
Most of the expensive initiatives that were enacted beginning in and even some of those enacted in and were bipartisan extensions of existing policies. The revenue side also shows a strong contrast after the elections. The contrast between these periods shows that the common conservative complaint that the Republican Congress acted as a rubber stamp for Obama is false.
The large federal government expansion under unified Democratic government ended immediately after the election. From that point on, discretionary spending was significantly reduced, and mandatory spending increases were largely limited to current-policy extensions that both parties supported. The Obama presidency did not result in the historic expansion of federal spending that many conservatives feared.
First, as my colleague Elaina Plott reported , he vented to colleagues about insufficient funding for his southern border wall and the lack of restrictions for so-called sanctuary cities. Trump tweeted Friday morning that he was considering a veto even after the bill cleared Congress, but his advisers talked him down.
Instead, party leaders were gleeful at what they had won. In addition to winning increases in domestic spending, Democrats were able to preclude the inclusion of dozens of the same restrictive policy riders that Republicans had tried to add while Obama was president.
The legislation retained funding for Planned Parenthood, for example, despite years of Republican promises to prohibit it. Representative Tom Cole of Oklahoma is the Republican chairman of the House appropriations subcommittee responsible for the Departments of Education, Labor, and Health and Human Services—by far the largest subsection of the domestic budget.
Cole put the onus on Trump and the Republican leadership, which agreed to the trade of significantly higher domestic spending for the increase in defense money. There is little the president can do to impact the debt, positively or negatively, without a bill passed by Congress.
Conversly there is little Congress can do without the president's signature or a veto-proof supermajority. Further, during most of Obama's term to date, control of Congress was split between a Democratic Senate and a Republican House.
Both branches share blame, both for legislation that increased the debt and for failing to enact legislation that would curb the debt growth that was already projected to occur from the growth of entitlement programs and insufficient revenues. By a few metrics, debt has doubled during the Obama presidency. Seen as a "half-baked cake" left over from the situation set up by former Speaker John Boehner R-Ohio , the bill passes with the support of a majority of House Republicans of in an early victory for new Speaker of the House Paul Ryan R-Wisc.
For the first time since the creation of the modern congressional budget process in , the House begins considering appropriations bills without first adopting a budget resolution or an equivalent measure establishing a high-level budget framework for the new fiscal year.
This approach results from conflict within the House Republican Conference and the refusal of some members to support a budget resolution that reflects the October budget deal. Congress narrowly avoids a partial government shutdown by adopting a measure to fund the government through December 9; the bill also includes full year funding for military construction and the Department of Veterans' Affairs.
Final deal hinges on resolution of two main sticking points: a proposed prohibition on funds to fight the Zika outbreak in Puerto Rico going to Planned Parenthood and the inclusion of funds to address the Flint, MI water crisis.
With unified Republican control of Congress and the White House on the horizon for the first time in a decade, the House and Senate opt to punt the remainder of their appropriations work for fiscal year again, this time until the end of April.
The later spring date gives the new administration the opportunity to weigh in on spending priorities while also accommodating a potentially busy congressional agenda—including Senate action on cabinet nominations—in early Conflict over the length of an extension of benefits for coal miners prolongs debate in the Senate, threatening a brief government shutdown.
Related FixGov How does a divided government impact the congressional budget process? Molly E. Wallach Wednesday, December 18, Gale, et al. Sarah A. Isabel V. Sawhill, et al. Henry J. William G. Aaron Mr. Philip A. Wallach Republicans' leverage from debt ceiling vastly overrated Philip A.
Wallach, The Hill.
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