Long Term Budget Problems? Obama Inherited Them

by: Mark Thoma

What is the cause of large and continuing budget deficits? The Bush tax cuts, the wars in Iraq and Afghanistan, and the economic downturn "explain virtually the entire deficit over the next ten years."

Deficit

Notice the tiny contribution of TARP, Fannie (FNM), and Freddie (FRE) (shaded red) and the stimulus package (shaded yellow, just below the red area) to the deficit from 2012 onward. These are not the source of our long-term budget problems.

For more, see the source of the graph: President Obama Largely Inherited Today’s Huge Deficits, CBPP.