Says "Bush Jr. handed Obama a $1.4 trillion deficit" and Obama "reduced Bush Jr.’s deficit to just $492 billion."
During the last four presidencies, deficits disappeared under one Democrat (Bill Clinton), went up under two Republicans (George H.W. Bush and George W. Bush) and traveled both up and down under one Democrat (Barack Obama). It’s actually a pretty complicated story, but the liberal advocacy group Occupy Democrats boiled it down into one graphic on Facebook with five short lines. "Bush Sr. handed Clinton a $269 billion budget deficit. Clinton handed Bush Jr. a $127.3 billion surplus. Bush Jr. handed Obama a $1.4 trillion deficit. Obama has reduced Bush Jr.’s deficit to just $492 billion. But tell me again which is the party of fiscal responsibility." Facebook users shared this post over 145,000 times, so we thought we’d take a closer look. We asked the group’s founder and editor-in-chief Omar Rivero to explain his numbers, and he offered a small correction. Rivero said the number for the first President Bush should be a deficit of $255 billion, or $14 billion less than stated. "A tiny error, really," Rivero said. "We stand firmly by our meme and its implication that Democrats are better stewards of the debt." We’ll set aside the bigger point and just focus on the numbers and the challenge of awarding credit or placing blame on the person in the Oval Office. In particular, we zero in on the claim that "Bush Jr. handed Obama a $1.4 trillion deficit" and Obama "reduced Bush Jr.’s deficit to just $492 billion." Rivero said he picked the first year of a new president’s first term and relied on data from the White House Office of Management and Budget. We used figures from the Federal Reserve Bank of St. Louis, which runs an interactive database for this figure for the Federal Reserve, but the two were largely the same. We color coded the four presidencies and marked the years Rivero picked in red. Source: Federal Reserve Bank of St. Louis For the framework Rivero used, and making allowances for his correction, his numbers are fine. In fact, in terms of reducing the deficit, Obama did a little better than the meme said. We should mention the timing of budgets and administrations. The federal fiscal year begins in October. A new president takes office in January and for the most part, typically operates under the budget he inherited. Tara Sinclair, a George Washington University economist, said for that reason, it’s "reasonable" to use the years that Rivero picked. But there’s a lot more to be said. 2009: Not your typical year The Great Recession hit hard in 2008 and grew worse in 2009. In that period, the unemployment rate doubled from about 5 percent to 10 percent. With Democrats in charge of both houses of Congress and the White House, Washington passed a stimulus package that cost nearly $190 billion, according to the Congressional Budget Office. That included over $100 billion in new spending and a somewhat smaller amount in tax cuts, about $79 billion in fiscal year 2009. George W. Bush was not in office when those measures passed. So a more accurate number for the deficit he passed on might be closer to $1.2 trillion. But Steve Ellis, vice president of Taxpayers for Common Sense, a group concerned by rising deficits, told PunditFact that the budget numbers don’t tell you much. It’s very difficult to untangle responsibility during those years, he said. "In FY2009 you didn’t just have the stimulus," Ellis said. "Many of the fiscal decisions at the end of the Bush presidency were done in consultation with the president-elect, like the Detroit auto bailout. Even with TARP (Troubled Asset Relief Program) both campaigns were consulted." Ellis is wary of what he calls snapshot comparisons because he doesn’t think they are fair to either the president stepping down or the one taking over. They ignore too much context. Ellis noted that before deficits plummeted under Obama, they remained quite high. The Occupy Democrats post brushed past that fiscal reality. "The debt has increased more under President Obama so far than it did in the entirety of President Bush’s eight years," Ellis said. "I don’t think that’s an accurate measure either, but it tells a different tale." Sinclair, along with Ellis, emphasized a simple fact of budgeting that should be factored in: the role of Congress. "Since Congress is really responsible for the budget, it's always a little strange to blame the president for it," Sinclair said. And Ellis noted that about two-thirds of all spending is mandatory, in the form of entitlement programs such as Social Security and Medicare. That said, according to the Congressional Budget Office, policy changes under George W. Bush — including tax cuts, the Iraq War, the Medicare prescription drug benefit and agricultural subsidies — greatly increased deficits. Our ruling Occupy Democrats said that George W. Bush "handed Obama a $1.4 trillion deficit" and Obama reduced Bush’s "deficit to just $492 billion." The post picked certain years to back that up, and for those years, its numbers were accurate. But many factors complicate this simple picture. While it’s true that Bush pushed policies that drove up deficits, the federal response to the Great Recession was to some extent shared by Bush and Obama. In addition, while deficits have fallen under Obama, the claim brushes over that deficits remained above the trillion dollar mark for several years, long after Bush left office. The statement leaves out a lot of important information. We rate it Half True.
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