By Logan Scisco
During the “off season” after NFL Nationals, the issue of the budget deficit has come to be a major one in American politics. It has the potential to shape the outcome of the midterm elections in 2010 and is playing a role in President Barack Obama’s declining popularity ratings. As extempers get ready for the 2009-2010 season, which starts in less than six weeks with the Wake Forest National Early Bird, they will face questions about an array of economic issues such as unemployment, the effectiveness of the stimulus package, and the level of international trade as well as the controversial issue of healthcare reform. All of these issues have something to do with the budget of the United States government and by proxy the deficit the U.S. government currently finds itself facing.
Americans in the late 1990s got used to seeing fiscal discipline on Capitol Hill between the executive and legislative branches. President Bill Clinton worked with Republican leaders on Capitol Hill, a relationship that was often tense through impeachment proceedings and a government shutdown, to craft a budget that was balanced and that ran a surplus totaling $128 billion. In fact, the major issue of the 2000 election between Vice-President Al Gore and then-Texas Governor George W. Bush was over what to do with this budget surplus, with Gore arguing that it needed to be used to shore up entitlement programs such as Social Security in a “lockbox” and Bush arguing that it needed to be given back to the American people in the form of a tax cut. After the first presidential debate between the two men in the fall of 2000, Saturday Night Live had a hilarious mock debate over this issue.
After Bush won the election, he was able to get Congress to approve his tax cut package and celebrated the occasion as a victory for small government. However, thanks to September 11th and a U.S. recession that began after Bush was elected, the federal government started to see deficits early in the Bush administration. By the time Bush left office, he and Congress, which was controlled for six years of his administration by Republicans, left the country with nearly a $500 billion deficit. To put this into perspective, that number represents nearly three percent of America’s gross domestic product (GDP), the total value of goods and services produced within the U.S. in a given year.
Therefore, this topic brief will describe the state of the budget deficit under the Obama administration, how Congress and the Obama administration are trying to cope with it, and the political fallout on the budget deficit issue.