The Congressional Budget Office tallied the country's debts and the number for 2011, is, to put it mildly, large. The CBO says if the government stays on track--meaning maintaining current tax levels and expenditures--we're on track to ring up a deficit of $1.5 trillion, on top of deficits of $1.4 trillion and $1.3 trillion from the past two years.
The nonpartisan report enumerates the causes behind the debt: stubborn unemployment numbers, which has translated into a two-prong loss both in terms of taxable wages and in funding unemployment benefits to help the out of work tread water; TARP, the 2009 American Recovery and Reinvestment Act, and the housing market crash that brought banks and construction-related industries into the mud along with everyone else.
Initial reactions to Wednesday's release were swift. The National Review's Avik Roy assailed the CBO's estimates, asking how it could have been so off-base last year when it estimated that we'd be in a $980 billion hole instead of $1.5 trillion one. Roy soon recanted, saying he'd read the report too quickly and owed "an apology to the good people of the CBO." Roy said he'd relied on the topline summary instead of the CBO's analysis which said the increase was due to legislation such as the Job Creation Act and the extension of unemployment numbers, not bad math. Mother Jones' Kevin Drum was also quick to criticize Wednesday's report, poking holes both at Roy's rapid-fire critique and blaming Bush's tax cuts for the increase. He, too, recanted, saying "[Roy's] right that not all of the lost revenue comes from extension of the Bush tax cuts."
Roy and Drum's detente aside, not everyone has been quick to return to their corners. Here's how others are grappling with the report:
- Blaming Bush For AJC's Cynthia Tucker, the first thing that has to be done is to get "Republicans ... to admit that the record-high deficit was exacerbated by extending the Bush tax cuts." The second, Tucker says, is that both parties are going to have to give ground: "Democrats and Republicans need to come to terms with a combination of tax cuts and spending increases that will put the nation on a longterm path to economic stability. Most mainstream economists agree that it will take both."
- Blaming Obama Commentary's Peter Wehner pins the problem on one person, saying the "report highlights just how irresponsible President Obama is by not seriously addressing our exploding debt, which means addressing our entitlement crisis, which means (above all) reforming Medicare."
- Seeking Sanity The Washington Post's Ezra Klein picks apart the Republicans' balanced budget proposal to whittle down the deficit. Conceding that the approach works with the GOP's distaste for deficits but fondness for tax cuts, Klein says it would cap "spending at 20 percent of GDP and requires a two-thirds vote for tax increases." The problem, Klein says, is that this system is not working for California, where "the dysfunctional, supermajoritarian budget process ... has sent the state to the edge of total bankruptcy."
- Urging Cooperation House Whip Steny Hoyer writes in a statement that the massive deficit is proof that budget discussions can't be a one-party-takes-all situation. The Maryland representative says he hopes the CBO's report will prompt both parties to "reform and simplify our tax code in a way that creates jobs and reduces the deficit, to scrutinize defense spending for waste, and to preserve our entitlement programs for generations to come."
- Holding Their Breath The Daily Beast's Benjamin Sarlin polls experts for what they consider a solid approach to such a daunting figure. He finds overwhelming support for running a deficit until the job situation turns around or "the economy starts to seize." This is not to say his experts endorse an open wallet; they do say it has to be coupled with crafting "a long-term deficit reduction plan already in place and primed to go as soon as the economy finds its footing."