May 11, 2022 - 9:00 pm
Joe Biden wants the American people to know that their president has nothing to do with soaring prices, empty shelves, energy shortages, rising crime rates or chaos at the border. That’s all somebody else’s fault. But a budget deficit that has receded from record highs? Why, Mr. Biden will be the first to tell you, his fingerprints are all over that accomplishment.
“We’re on track to cut the federal deficit by another $1.5 trillion by the end of this fiscal year,” the president said during a May 4 address on the economy. “The biggest decline ever in a single year, ever, in American history.” He went on: “And the biggest decline on top of us having a $350 billion drop in the deficit last year, my first year as president. The bottom line is that the deficit went up every year under my predecessor — before the pandemic and during the pandemic — and it’s gone down both years since I’ve been here. Period. They’re the facts.”
It’s true that Donald Trump was no fiscal hawk. But it speaks to the president’s political desperation that he would now attempt to disguise himself as a penny-pincher intent on bringing financial sanity to Washington. After all, Mr. Biden has been a Beltway mainstay for five decades and was never known for his devotion to austerity.
Of greater importance, his facts are devoid of important context.
Mr. Biden is comparing recent spending to the 2020 budget year, when the federal government was shoveling money into the economy at an unprecedented rate in order to minimize the financial ravages of coronavirus disruptions. In fiscal 2020 — which ended about a month before his election — the federal deficit hit a record $3.1 trillion. It fell to $2.8 trillion in fiscal 2021 and is expected to drop to around $1.3 trillion in the current fiscal year. Thus the $1.5 trillion exercise in deficit reduction for which the president seeks credit.
Yet Mr. Biden is responsible for deficits that are historically astronomical when compared to any pre-pandemic baseline. Under Mr. Trump in fiscal 2019, for instance, the deficit was $900 billion, up from about $750 billion the previous budget year. “Biden is bragging about presiding over what’s likely to wind up as the fourth-largest deficit in history,” Reason magazine’s Eric Boehm noted last week. “This is what passes for fiscal responsibility in Washington, D.C., these days.”
Indeed, data from the Office of Management and Budget reveal that, under Mr. Biden’s future spending blueprints, deficits will run at levels far above the norm into the next decade. Of course, soaring inflation debases the value of the dollar and reduces the real value of government debt. But don’t expect the president to be crowing about that development.