If You Focus On One Part of the Budget

There's a nifty little video produced by the Center for Freedom and Prosperity Republicans are floating around the Internet as some sort of presidential spending guide that Obama should emulate.

The video, of course, uses Reagan as an example of a president that kept the budget under control. It also uses Clinton as another example but is sure to mention that his spending restraint was held in check by a Republican Congress, while also mentioning Clinton did not control spending as well as Reagan.

Scratch that. I keep saying spending as if spending means spending. The Republican video only highlights one part of budget spending, domestic. Everyone knows the federal budget is more than just one section of spending. It contains domestic, foreign, defense, on-budget and off-budget items.  Saying that Reagan kept domestic spending in check totally ignores the simple fact that total spending increased every single year under Reagan.

Total Spending

Fiscal Years 1981 to 1989

Year GDP-US

$ billion Total Spending -

1982 1179.43

1983 1283.58

1984 1353.86

1985 1496.35

1986 1592.78

1987 1662.08

1988 1771.39

1989 1915.21

Maybe Reagan did stave off domestic spending a whopping 1 percentage point of GDP during his 8 years in office.  But that means he spent our tax money on things other than the people who pay taxes because after all, spending did increase under Reagan.  Now how is that fair?

Yet, and I don't know how or why this is so hard for the "fiscal conservatives" to understand, but increasing domestic spending by $80 billion is still a spending increase.  Nowhere did Reagan cut real dollars.  It's just that GDP grew faster than domestic spending (by 1% point of GDP remember!!).

Nonetheless, all of this totally ignores the fact that even though Reagan supposedly kept domestic spending at reasonable levels, he still ran mammoth budget deficits every year.  And he still tripled the national debt!

Good news though.  The video makes note several different times the key to overall budget responsibility is to cut domestic spending (spending less tax money on tax payers).  That means Obama's budget blueprint for 2012 is spot on because it cuts hundreds of billions from domestic resources.