PolitiFact Wisconsin: Sen. Ron Johnson says deficits under Obama total $5.3 trillion, compared with $2 trillion under Bush

Remember those nerdy charts that Ross Perot flashed during his third-party run for president in 1992?

The Texas billionaire’s visual aids warned of the perils of America’s mounting government debt.

Twenty years later, Wisconsin’s junior U.S. Senator, Republican Ron Johnson, is taking a page from Perot as he acts as a surrogate for Mitt Romney and advocates for a spending slowdown.

Explaining one of his digital charts during a Sept. 11, 2011 campaign stop in Sheboygan, Johnson ripped Obama for saying his administration’s proposed ”Buffett rule”  tax plan for million-dollar earners would “stabilize our debt and deficits for the next decade.”

“I haven’t yet publicly called President Obama a liar,” Johnson told his audience. “But I’m saying he lies. Slight diplomatic difference.”

Johnson said the “Buffett rule” would raise just $5 billion a year. He’s right, as PolitiFact Ohio found in rating True a claim by Sen. Rob Portman that it would “bring in less than $5 billion per year. … Enough to pay one week’s interest on the national debt.”

Johnson’s presentation uses a chart to contrast the “Buffett Rule’s” revenue potential to the deficits accumulated under Obama (2009-2012) and over the two terms of his predecessor, Republican George W. Bush (2001-2008).

The chart shows deficits totalling $2 trillion in eight years under Bush, and $5.3 trillion under Obama in just four years. A caption on the chart says those deficits “exploded during the Obama administration.”

Is Johnson right on the deficit numbers and their rapid growth?

As backup, Johnson’s campaign cited numbers from the White House’s Office of Management and Budget.

The figures show red-ink budgets in seven of eight years that coincide with Bush’s term. The annual deficits totalled $820 billion in his first term and nearly $1.2 trillion in his second.

Add them up and there’s the $2 trillion figure cited by Johnson.

That same White House table shows four years of deficits for 2009-’12, the time frame that coincides with the Obama era, ranging from $1.29 trillion to $1.4 trillion. The total, including estimated figures for 2012, is $5.33 trillion.

That’s nearly triple the Bush deficit figure, in half the time.

It seems simple, with the numbers and the trend matching up with Perot’s, er, Johnson’s chart.

We wish it were that simple.

But there is considerable disagreement in academic and political circles over how to assign responsibility to presidents for spending and deficits.

Using the same table and a slightly different approach can put a somewhat different spin on the trend line — though we found no scenario under which the Bush-era deficits top those under Obama.

Here’s why.

The big question any researcher faces is when to start and end the clock when looking at spending and deficit by presidents.

It would be tidy to start the clock on Inauguration Day, but the federal budget year begins Oct. 1. That means an incoming president inherits a budget-in-progress from his predecessor, though he often makes changes.

That timing mismatch makes a pretty big difference, for example, in pinning deficit numbers on Bush and Obama.

To wit: Democrat Bill Clinton’s last budget, for fiscal 2001, resulted in a surplus of $128 billion — the last black-ink budget on record. But Johnson attributed that surplus to Bush, who entered office Jan. 20, 2001. Johnson argues that once elected the budget can be changed by the new president.

Similarly, on the back end of the Bush years, Johnson gives the eye-popping 2009 deficit of     $1.4 trillion all to Obama — even though Obama was working with Bush’s last budget, which took effect in October 2008, during the final months of Bush’s second term.

That methodology becomes even more important when you consider that just before Bush left office, the deficit for fiscal year 2009 already was projected to be $1.2 trillion, according to the scorekeeping agency for Congress, as reported by PolitiFact.

So, Johnson attributes the 2009 deficit entirely to Obama even though much it was already anticipated before the Democrat’s inauguration. (By the end of the 2009 fiscal year, the deficit rose to $1.4 trillion in part due to Obama’s economic stimulus plan).

What about Johnson’s methodology?

We asked three experts who closely follow the budget, and each said there is no consensus on how to attribute the overlapping budget years.

Steve Ellis, vice president of Taxpayers for Common Sense, said apportioning responsibility is “really tricky.”

“Looking at what has happened — budget deficit-wise — during the Bush and the Obama presidencies doesn’t tell the whole picture because of the differences of the fiscal year and impacts of policies that were enacted prior to either of them assuming office,” Ellis wrote in an email.

Still, Ellis said he considered Johnson’s numbers correct even if the presentation was simplistic.

What’s more, there are some extra complicating factors unique to the Bush-Obama changeover, such as how best to parcel out the deficit blame for such things as Bush’s major tax cuts and Obama’s more modest tax trims, two wars that overlap their presidencies, two recessions, a Wall Street bailout that each supported, and major new programs under each (Medicare prescription drugs, stimulus).

The Great Recession of 2007-2009, which fueled deficits when tax collections fell, also overlapped the two presidencies.

Jason Peuquet, research director for the Committee for a Responsible Federal Budget, said Johnson’s numbers were defensible. He suggested looking at the increase in debt – as opposed to deficits — because it can be tracked to the day a president starts and ends a term.

By that measure, we found a $4.9 trillion increase in gross public debt in Bush’s two terms vs. $5.4 trillion so far in Obama’s single term.

Gary Burtless, a senior fellow at the Brookings Institution, said “there is no good answer to your question that is going to satisfy everyone.”

Our rating

Johnson’s chart showed $2 trillion in deficits under Bush and $5.3 trillion under Obama, and concluded that deficits “exploded” during the Obama administration.

The numbers check out, but comparing presidents’ budget records is not as simple as Johnson’s chart suggests. For instance, Bush owns some debatable piece of the Obama deficits.

We rate Johnson’s claim Mostly True.

From PolitiFact.com

calendar

Op-Ed: Follow Mitt Romney’s plan to restore economic growth

By: Ron Johnson

Jobs. The economy. Growth. These are the issues that should define this election.

For almost four years, President Barack Obama has pursued his plan — the plan he claims he will continue if he is reelected. That plan has focused on expanding government. We’ve seen a roughly $800 billion stimulus. We’ve seen billions invested in “green energy” companies, many of which the president’s campaign donors either ran or invested heavily in. Despite these efforts — or perhaps because of them — unemployment has remained above 8 percent for 43 months, and the growth of our economy has slowed to less than 2 percent. With no relief in sight.

Now the president is calling for more of the same. He wants to pass a jobs plan — a second stimulus paid for by higher deficits or more taxes on small business. It’s curious that he is willing to increase taxes on small businesses when the economy is slowing because in 2010, he said that raising taxes “would be a mistake when the economy has not fully taken off.”

These are bad ideas — not the sort of proposals that anyone hoping to return our nation to prosperity should support.

It doesn’t have to be this way. We have an alternative, a plan based on the things that have made our country prosperous in the past. It’s Republican presidential nominee Mitt Romney’s plan — and it’s one that deserves a chance.

Romney’s plan is based on several pillars: reducing wasteful federal spending, reforming the nation’s Tax Code, developing trading opportunities, restoring the viability of entitlement programs and reining in needless regulation. These reforms are critical if we are to end the spiral of uncertainty and bloated government that has kept our economy from recovering.

His plan begins with stopping the runaway spending and debt that is increasing market uncertainty and mortgaging our future. Romney aims to reduce federal spending as a share of gross domestic product to 20 percent by 2016.

His critics will, no doubt, howl that these are draconian cuts that will lead to a parade of horrible outcomes. But in fact, they are merely reductions in the rate of spending growth, and 20 percent is the 40-year average spending level prior to the Obama administration’s four-year spending spree.

Still, taking this simple step will not only help to lift uncertainty; it will eliminate the need for job-killing tax increases like the one Obama is now pushing.

But it doesn’t end with reducing the rate of spending growth. Our Tax Code has been in need of reform for decades. Romney will finally make that a reality. He plans to reduce individual marginal income tax rates across the board by 20 percent. He will keep current low rates on dividends and capital gains. And he will reduce our corporate income tax rate — now the highest in the developed world — to 25 percent. Because he will also broaden the base, this reform will not only simplify the code and reduce the tax burden on average Americans, it will do so in a revenue-neutral way that will not increase the deficit.

One major drag on our economy has been our entitlement programs. Social Security and Medicare are increasing in cost and, without reform, both will go bankrupt. Romney plans on gradually reducing growth in Social Security and Medicare benefits for wealthy seniors while giving more choice in Medicare programs and benefits. Saving Social Security and Medicare doesn’t have to mean reduced benefits for middle-class Americans. But it will require leadership.

In addition, we must reduce the weight of government that burdens our job creators. We can do this by eliminating ineffective, harmful and costly regulations. Romney will review the cost of every regulation and get rid of those that cost more than they are worth. He will remove regulatory barriers to energy production and job creation.

Most important, he plans to repeal “Obamacare.” Instead of expanding government, Romney will empower market-oriented, individual-based reform.

There are many differences between Obama and Romney. But perhaps none is starker than their two plans for restoring economic growth. Obama is high on rhetoric but low on specifics and low on new ideas. Romney’s proposals are bold and precisely what this country needs.

We have had enough talk, and we’ve heard enough speeches. It’s time for change. That’s what Obama promised four years ago. He didn’t deliver.

Obama didn’t keep his promises. Romney will. That’s change we can believe in.

Published on Politico.com

calendar

Human Events: Johnson Challenges IRS Obamacare Gimmick

By: Neil W. McCabe

9/14/2012 06:10 AM

The freshman senator from Wisconsin is challenging the IRS rule that circumvents Congress to support the creation of federal-facilitated health insurance exchanges and expose millions of Americans to Obamacare penalties.

When President Barack Obama and the Democrats passed the 2010 Patient Protection and Affordable Care Act, they made a poorly crafted law, said Sen. Ron Johnson, who beat liberal icon Russ Feingold in 2010. In the law, individual states are expected to establish health care insurance exchanges, which are to be marketplaces where insurance plans are bought and sold.

Johnson said, as someone who is trying to frustrate the implementation of the health care law, he cannot ignore a bureaucratic gimmick to fix a problem that should be resolved in Congress.
The mechanism for Johnson’s challenge is a Resolution of Disapproval, Senate Joint Resolution 48, a privileged motion authorized by the Congressional Review Act, which empowers Congress to undo regulations promulgated by the executive branch with a majority vote in both chambers, he said.

The IRS rule in question pivots on six characters in the law, said Michael Cannon, the director of Health Policy Studies at the Washington-based Cato Institute.

Cannon said the IRS put out the rule in 76 Federal Register 50934 dated Aug. 17, 2011: “a taxpayer is eligible for the credit … if … the taxpayer or a member of the taxpayer’s family enrolled in one or more qualified health plans through an Exchange established under section 1311 or 1321 of the Affordable Care Act.” [Emphasis added.]

The six characters: “or 1321,” are key because section 1321 spells out federally facilitated exchanges, but the actual language of the Affordable Care Act does not authorize federal subsidies or tax credits for participation in a 1321 exchange, he said.

Johnson said, “These subsidies and tax credits will be paid through exchanges, and here is the keyword: ‘established by the state under 1311,’ the only language in the bill in terms of allowing subsidies or the tax credit to be paid is through exchanges established by the state.”

“Massive screw-up by the Democrats”

The Obama administration wrote the health care law so it depended on state-established exchanges in order to blunt the charge that the federal government was taking over health care, he said. In other words, state exchanges, rather than federal, gave them political cover.

The major miscalculation was that so many states would not embrace the exchange mechanism, Johnson said, as it was assumed the states would cooperate. “That’s a problem because only 15 states have actually established these exchanges, 35 have taken a hands-off attitude, at least so far,” he said.

Not only does the law only authorize tax credits and subsidies for state-established exchanges, the penalties are tied to the state-established exchanges, he said.

The penalty regime does not punish employers for failing to provide health care insurance, until an employee becomes eligible for a tax credit or subsidy for his participating in a state-established exchange, the senator said.

If there is no state-established exchange, there is no penalty, he said. Without the carrots-and-sticks of subsidy, tax credits and penalties operating at the state level, the entire Obamacare implementation scheme is jeopardized.

“Obviously this is a massive screw-up by the Democrats, who rushed this bill through,” he said.

Brown’s role

On Christmas Eve 2009, one month before the election of Massachusetts Sen. Scott Brown (R) to fill the seat left empty by the passing of Sen. Edward Kennedy, Sr. (D-Mass.), the Democrats in the Senate rushed through President Barack Obama’s health care reform bill.

Once Brown gave the Republicans their 60th vote in the upper chamber, they had the ability to block further action, and thus the bill’s language was frozen.

In the regular legislative process, the House and Senate each pass bills and the differences between the bills are hashed out in a conference committee, which is made up of members from both houses, who produce a single bill. Before reaching the president’s desk, both chambers must approve the conference committee’s bill.

Unable to control the Senate, Democrats were not only stuck with the language of their Senate bill in the upper chamber, they could not risk going to conference. The only way to avoid going to conference was for the House to pass the exact Senate bill and then send it on to the president.

When the Democrats lost control of House and effective control of the Senate in the 2010 mid-term elections, any changes in the law would involve the Republicans.

After the law was signed by the president in March 2010, the Treasury Department, through the IRS, changed the law without dealing with lawmakers on Capitol Hill, as the realization sunk in that many states were not going to set up exchanges and that the administration would need to enable a federal agency, such as Health and Human Services, to fill the gap.

Johnson launches the challenge

To initiate the challenge process, Johnson needed to collect 30 signatures from other Senators on a discharge petition, he said. “We have the required number of signatures to bring this to the floor.”

The Badger State senator said he collected the bulk of the signatures at a Sept. 11 luncheon for Republican senators. “We have 34 now, and we are trying to get every Republican, naturally.”

The petition is supported by the Republican leadership, including Senate Minority Leader Mitch McConnell (R-Ky.). When asked if Senator Brown had signed, Johnson said ‘not yet, but we’ll keep asking him.”

“A lot of time these discharge petitions take a while to get the signatures,” he said. “We have already met the threshold level and we are taking a look for the next step.”
Johnson said he spoke to the Mitt Romney campaign before the August recess about his bill and would guess that the former Massachusetts governor would support the bill.

The popularity of the bill outside the Washington beltway took Johnson by surprise, he said. “We have 46 outside groups that have notified us of their support and 50,000 people have signed an online petition,” he said.

Although the resolution is privileged, Senate Majority Leader Sen. Harry Reid (D-Nev.) still controls the agenda, so the challenge is to force a vote on the floor before the election, he said. “[Democrats] want to make sure there are no tough votes, but they may want to throw a couple political votes at us before they leave town,” he said. “Frankly, I’m a little worried about the relative complexity of the subject matter that it’s going to be difficult to explain it on the Senate floor,” Johnson said. “We still have work to do to clarify and simplify,” he said.

Phil Kerpen, the president of Washington-based American Commitment, said he is grateful that Johnson is making the effort to reverse the rule: “I’ve argued to Republicans that this is a smart thing to do.”

Human Events

calendar

Senator Ron Johnson on The Anniversary of September 11

Today marks the 11th anniversary of the terrorist attacks on our nation. Please remember the victims of that cowardly assault, and pray that their surviving friends and family have been able to find some measure of comfort and peace. We should also give thanks to all those who have sacrificed to defend our freedom and the women and men of the armed forces and first responders who protect America each and every day.

calendar

Op-Ed: Milwaukee Journal Sentinel: Biden should be honest about Obama’s record

By: Ron Johnson

This Sunday, Vice President Joe Biden will campaign in Green Bay. His job is not an enviable one. He’s tasked with the role of explainer, of feeling your pain. And unfortunately, in the Obama economy, there’s a lot of explaining to do – a lot of pain to feel.

Vice President Biden is known for being a straight shooter. Earlier this summer, he noted at a campaign event that for many Americans, the economy felt like “a depression.” That is, of course, true. For the 23 million Americans who can’t find work, this does indeed feel like a depression, and the fact that unemployment has hovered above 8% since the beginning of President Barack Obama’s term doesn’t help. Neither do sinking wages or anemic economic growth.

But in making that statement, Biden likely strayed from the Obama campaign talking points. After all, President Obama’s narrative is that it could be worse. That’s what he’s trying to convince voters this election cycle. He doesn’t want to wallow in the tough details of the present. He’d rather move “forward,” which is to say, away from his record.

We will hear a lot from Biden this weekend, but there is one thing we probably won’t hear from him: We won’t hear real plans to revive the middle class in this country, because he and the president have no plan. The Obama administration has exhausted its hand. They’ve done what liberal politicians do. They spent money we don’t have, they grew government (Obamacare), they wasted time and money (the “stimulus”), and inhibited energy independence (rejecting the Keystone pipeline).

It didn’t work, and that has been devastating for people across the country. It’s not just the millions of Americans who cannot find jobs. It is also families who are slipping into poverty, and young people whose lives seem to be stuck in place because they can’t get that first job.

Americans have always been a risk-taking people. We’re willing to bet on tomorrow because we think it’ll be better than today. It’s this kind of faith that makes our country great and our society one of extraordinary opportunities. Students take out loans to go to college and make a better life for themselves. Entrepreneurs invest countless hours in building a new business.

Under Obama, that optimism is receding. New business start-ups have fallen to the lowest level in decades. Students graduate college only to experience crushing student loan debt and fewer jobs. It’s no wonder why. Obama is willing to tell business owners that they didn’t build their businesses, and that same anti-business attitude runs through his policies. That’s not a way to create jobs, and it’s certainly not what people had in mind four years ago when President Obama promised hope and change.

And that’s not something that the vice president should ignore. Voters in Wisconsin deserve solutions to the challenges our country faces. We’re not looking for more excuses or fancy rhetoric.

Mitt Romney and Paul Ryan offer a different approach. They know that Americans are looking for leadership that will confront our troubles head-on. They have a plan to restore the middle class in this country by creating 12 million jobs. At a time when we need levelheaded problem-solving, that’s precisely what they’ll deliver.

The Milwaukee Journal Sentinel.

calendar