The Big Lie and The Facts

This graph shows how the budget deficit has increased during the Obama Administration.  The GOP ad campaign is underway that blames the increase in the budget deficit on "out of control" government spending.

The graph tells a different story. It shows that spending increased during the recession and that it has flattened out during the recovery.  Part of the increase in spending was due to the stimulus (on third was tax cuts), and part was due to automatic stabilizers that kick in during recessions.  That includes unemployment claims, food stamps and other increases in spending that are determined by existing laws.  

The graph also shows the huge decline in tax revenues during the recession.  Tax revenues always fall when there is a decline in national income.  Tax revenue has stopped its decline during the recovery but it is still well below the pre-recession trend.  

The blue spending line appears to be on the trend that existed prior to the recession.  If the red tax revenue line  were extended on its trend prior to the recession, the budget deficit would look much like it did before Obama took office.  One could also argue that the recovery would have much smaller without the increase in federal spending that compensated for the decline in household and business spending.

The GOP big lie machine will continue with ads like this between now and next November.  Many are funded by tax deductible contributions to "educational" PAC's like the US Chamber of Commerce.