Projection As An Art Form

“President Trump is a threat to our democracy” is the cry of those panicked on the political left. First of all, we don’t have a democracy–we have a representative republic. Second of all, President Trump is not the one limiting free speech and jailing his political opponents. But there are some other current lies that need to be debunked.

On Sunday, The New York Post reported:

Projection is blaming someone else for your own bad behavior.

We saw a classic case of projection in Thursday’s presidential debate, when President Biden — who is overseeing annual budget deficits of $2 trillion — asserted that his predecessor, Donald Trump, added more to the federal debt than anyone else.

It’s part of the latest leftist argument: that if Trump wins the election, he will run deficits twice as large as Biden would.

Debate moderator Jake Tapper joined the chorus of federal finance falsehoods when he claimed Trump had “approved $8.4 trillion in new debt,” while Biden’s actions will increase the debt by (merely) $4.3 trillion over a decade.

Those numbers are based on the predictions of the Committee for a Responsible Federal Budget (CRFB). This group opposed the Trump tax cuts which increased federal revenue.

The article continues:

The fundamental flaw of the CRFB analysis is revealed if we examine the projections of the Congressional Budget Office.

The CBO’s projection for 2021, the last fiscal year of the Trump administration, forecast the federal debt to reach about $35.3 trillion by 2031, that is, over the next decade.

Today, 3½ years into the Biden administration, the latest estimates from the CBO project the debt will hit over $42.5 trillion by 2031.

The article concludes:

Biden wanted to spend $2 trillion more in the last year and a half, but conservatives in the House blocked the added bloat. 

You can bet the farm that if the radical left wins the White House and Congress in 2024, that $2 trillion outlay will be first on their legislative agenda. 

Biden’s other big lie, backed by the CRFB analysis, is that extending Trump’s tax reform will drown the economy in debt.

Yet federal tax revenues have increased since that tax reform was enacted — and federal revenues as a share of GDP have not fallen.

All of the increase in today’s debt has been due to massive, out-of-control federal spending — by both parties.

Trump spent and borrowed too much, full stop.

But with a debt headed to $50 trillion if reelected and a political agenda that stifles economic growth, Biden has set America on an unsustainable fiscal path that will lead to financial oblivion.

It’s the spending, stupid.

 

Things To Notice

On October 15, The Wall Street Journal noted:

The U.S. government ran its largest budget deficit in six years during the fiscal year that ended last month, an unusual development in a fast-growing economy and a sign that—so far at least—tax cuts have restrained government revenue gains.

The deficit totaled $779 billion in the fiscal year that ended Sept. 30, up 17% from $666 billion in fiscal 2017, the Treasury Department said Monday. The deficit is headed toward $1 trillion in the current fiscal year, the White House and Congressional Budget Office said.

Deficits usually shrink during economic booms because strong growth leads to increased tax revenue as household income, corporate profits and capital gains all rise. Meantime, spending on safety-net programs like unemployment insurance and food stamps tends to be restrained.

In the last fiscal year, a different set of forces was at play as economic growth sped up. Interest payments on the federal debt and military spending rose rapidly, while tax revenue failed to keep pace as the Republican tax cuts for both individuals and corporations kicked in.

What you just read is totally misleading. The statement that ‘ tax revenue failed to keep pace as the Republican tax cuts for both individuals and corporations kicked in” is absolutely false. The two major parts of the problem are Congress’ lack of ability or willingness to cut spending and the fact that when the federal reserve raises interest rates, it increases the interest the government pays on the current debt, thus increasing the deficit. As far as the tax cuts are concerned, the facts are quite different from what The Wall Street Journal reported.

On October 16, Investor’s Business Daily reported:

Critics of the Trump tax cuts said they would blow a hole in the deficit. Yet individual income taxes climbed 6% in the just-ended fiscal year 2018, as the economy grew faster and created more jobs than expected.

The Treasury Department reported this week that individual income tax collections for FY 2018 totaled $1.7 trillion. That’s up $14 billion from fiscal 2017, and an all-time high. And that’s despite the fact that individual income tax rates got a significant cut this year as part of President Donald Trump’s tax reform plan.

True, the first three months of the fiscal year were before the tax cuts kicked in. But if you limit the accounting to this calendar year, individual income tax revenues are up by 5% through September.

Other major sources of revenue climbed as well, as the overall economy revived. FICA tax collections rose by more than 3%. Excise taxes jumped 13%.

The only category that was down? Corporate income taxes, which dropped by 31%.

Overall, federal revenues came in slightly higher in FY 2018 — up 0.5%.

Spending, on the other hand, was $127 billion higher in fiscal 2018. As a result, deficits for 2018 climbed $113 billion.

The underline is mine.

It’s the spending, stupid! We need a Congress that will curb spending and a Federal Reserve that will move slowly.

A Much-Needed Accomplishment

The Gateway Pundit reported today that President Trump has cut the federal debt. He has not only cut the federal debt, he has cut more from the U.S. Federal debt for a longer period of time than any other President in United States history.

The article reports:

When President Trump was inaugurated on January 20, 2017 the amount of US Federal Debt owed both externally and internally was over $19 Trillion at $19,947,304,555,212.  As of August 17th the amount of US Debt had decreased by more than $100 Billion to $19,845,188,460,167.

The article points out that the US Government Accountability Office (GAO) has performed audits since 1997 of the US Debt amounts outstanding.  In their analysis they show that when accounting for US Debt Held by the Public and US Intergovernmental Debt Holdings, the amount of US Debt has increased every year since their audits began.

This is the chart of that debt history shown in the article:

The debt nearly doubled under President Obama. It is long past time to bring government spending under control.