Video: Olby talks about "federal budget debt", gets everything wrong

Newsbusters jumps all over Keith Olbermann for one of his Worst Person in the World segments, this time slamming Rep. Marsha Blackburn while defending the explosion of deficit spending in the Obama administration. Unfortunately, Olby manages to mangle just about every fact in the process, with the exception of getting Blackburn’s name right:

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KEITH OLBERMANN, HOST: That`s next, but first tonight`s worst persons in the world. The bronze to Congresswoman Marsha Blackburn of Tennessee. You`ll remember, the record setter for longest monotone question to the president at their meeting. Her new debt solution? Allowing younger Americans to privatize their Social Security accounts, where they can get wiped out the next time the mortgage industry or some other form of legalized gambling wipes out another chunk of the economy. By the way, federal budget debt is a good thing in a recession. It`s not a bad thing. As a percentage of Gross Domestic Product, it`s about the same as it was in 1970, as it is right now, far less than it was throughout the Reagan administration.

Olby does get one other thing right, or at least in the ballpark: both parties have argued at different times that deficit spending in a recession is a necessary evil, but not a good practice for long-term strategy. Some of our friends on the Right may have forgotten that George W. Bush made the same argument in 2001 after the 9/11 attacks and the financial hit it created. But even John Maynard Keynes, the father of that school of economic thought, warned that deficit spending could not be allowed to outstrip the government’s ability to service and eventually retire the debt rolled up by a nation spending its way out of recession.

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Otherwise, Olby manages to get just about everything else wrong.  There is no such thing as “federal budget debt”; there is federal debt, which is a cumulative amount of all the deficit spending from our entire history, and there is an annual federal budget deficit.  The latter as a percentage of GDP in 1970 was 0.3% according to the OMB.  The highest that number ever got in the Reagan administration was 6%, in 1983, which isn’t a good number, but hardly compares to the 9.9% it is for 2009 or the projected 10.6% it will be for 2010.

Insofar as federal debt is concerned, Newsbusters has that breakdown as well.  Bear in mind that since this is a cumulative number, the impact of one budget is necessarily limited.  With that in mind, the debt as a percentage of annual GDP was 37.6% in 1970.  By the end of the Reagan years, it was 53.1% (Reagan signed off on the 1989 federal budget), up from 32.5% at the end of the Carter presidency.  By the end of the Clinton presidency, it had risen only to 56.4%.  Considering that the last budget George W Bush signed was for FY2008, one can reasonably lay at his feet the hike to 69.2%.  Barack Obama signed off on the FY2009 budget thanks to Democratic keep-away using continuing resolutions, and the estimated GDP percentage of federal debt is now 94.3% — and using Obama’s budget estimates, will continue escalating to 102.6% of GDP by 2015.

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None of these numbers are especially difficult to retrieve, by the way.  Apparently, Keith Olbermann is less of a journalist than most bloggers, who understand how to Google for actual data rather than pulling numbers out of one’s nether regions.

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David Strom 6:00 AM | April 26, 2024
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