According to NewsMax (ugh) our esteemed former lobbyist/former governor/current lobbyist Haley Barbour was on Fox News this weekend complaining that President Obama isn't paying enough attention to the debt.
“The president goes on TV the other day and says: Well, the debt and the deficit, that's a problem in the long term, but it's not a short-term problem,” Barbour told Greta Van Susteren of Fox News Monday night.
Presumably he's talking about Obama's recent interview with David Letterman, in which Obama said about government debt "...in fact, the majority of it is held by folks who live here. But we don't have to worry about it short-term, right now interest rates are low because people still consider the United States the safest and greatest country on Earth, rightfully so, but it is a problem long-term, and even medium-term, and so we're going to have to take care of this deficit. But we've got to do it in a balanced way... I don't want to balance it solely on the backs of middle class families..."
The debt discussion starts at about the 6-minute mark:
(Note from Barbour's quote that he seemed to mis-remember the president saying it's a "medium-term" problem. Given Barbour's unwavering dedication to the truth, I assume a correction is being drafted by his personal secretary at this very minute. We'll post it prominently when we receive it.)
As for the actual argument, Obama says this because he understands what Bill Clinton calls "arithmetic"—with interest rates at historic lows, the cost of "borrowing" money to run the U.S. government (the interest payments on Treasury notes) is not a short-term problem, as the cost of interest payments on the debt are about the same as they were in 2008, despite the considerable increase in the principal during the Great Recession.
In Fiscal Year 2008, for instance, interest on the U.S. debt was $451 billion -- in FY 2011, it topped that number for the first time in Obama's presidency, at $454 billion, because interest rates during the recession have been low. We caught a break there. Now we need to take that break and start working on a smart solution.
Here's more Barbour:
“The truth is the average American understands the truth: The government can't spend itself rich any more than your family can spend itself rich,” Barbour said. “But if you wait until the long term, the kinds of changes that you're going to have to make are unbelievable.”
This, of course, loops us back to two fundamental flaws in the GOP's reasoning. (1.) The belief that there is somehow enough discretionary budget "spending" to cut (in transportation, housing support, education, aid to impoverished families) in order to return is us to a more manageable deficit picture. (2.) The idea that you can somehow come through a decade of revenue cuts during times of extraordinary spending on war-making and government job creation (G.W. Bush increased government spending more than any of the six presidents preceding him, including LBJ) and not need to increase revenues to pay for your profligate policies.
Of course, Barbour is unlikely to encourage us to consider Reagan, GHW Bush or Clintonian defense cuts, given that in the same interview he swivels around and attacks Democrats on that very point:
Barbour: "I don’t blame Lockheed Martin or any other defense contractor," Barbour said. "But the truth is the Democratic side wanted to make these defense cuts. The average employee . . . of you name the defense contractor, their jobs are in jeopardy because the left would not agree, and we're ending up with huge defense cuts."
To borrow a phrase from Barbour, "the truth is" that these are medium-term problems in part because you can't turn the good ship U.S.A. around overnight. Adjusted for inflation and population growth, non-defense discretionary spending in 2011 was exactly the same as it was in 2001. What's up (in discretionary spending) is defense -- precipitously since the beginning of George W. Bush's president, from the mid-$400s to where it is today between $700-850 billion depending on what and how you count. (If you include non-DOD military and security spending, you can make the argument that our current defense infrastructure costs us over $1 trillion a year.)
From Reagan through Clinton, there were 12 straight years of declines in military spending; under Bush II (and the unbridled hubris of the neo-cons), the annual defense budget had roughly doubled by the time he left office. Obama is winding down two wars while facing a GOP-led Congress that won't touch dollar #1 of defense spending for political reasons.
Paying for the "guns and butter" budgets of the 2000s (...yes, and entitlements, including prescription drugs) is still a very real problem that should be a part of an honest and balanced discussion of how to lower the deficit... that includes a look at all discretionary spending along with an increase in revenues and reform of entitlements.
That, Mr. Barbour, is "the truth." Just imagine how refreshing it would be if you were honest about it.