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How Quickly We Forget: Dick Cheney, “Deficits Don’t Matter”

Sure, it’s huge, but big deficits don’t always lead to bad economic health. As we found during The Great Depression, the opposite is also true.

For those worried about the future, huge federal deficits remain the gift that keeps on giving, or taking, depending on your point of view. They are always around, always huge, and seem to be an issue that neither party has immunity from.

If you care to bash Republicans over this issue you need look no further than former Vice President Dick Cheney who told former Treasury Secretary Paul O’Neill that “deficits don’t matter” when the latter voiced concerns about the size of the federal bill. Cheney later fired O’Neill, presumably for thinking deficits actually mattered.

Still, Cheney was true to his word, as the White House of George W. Bush raised the federal deficit every year it was in office. When Bush started his presidency, the national debt as a percentage of gross domestic product hovered at 60%. By the time he exited, it was closer to 80%. Surely the first part of President Obama’s term will see that ratio only rise further, as the federal government fully deploys the $700 billion Troubled Asset Relief Program, the $200 billion Term Asset Backed Loan Securities Facility and the $500-$1 trillion Public-Private Investment Program, among other alphabet soup bailouts.

Of course, to critics of Obama, including conservatives, now deficits do matter a lot more than they did a year ago. Look no further than the well-covered “tea parties” to see an instance where partisanship has seemed to trump fiscal stewardship, or at least short-term memory.

By: David Serchuk: Article originally posted August 5, 2009, Forbes.com

April 16, 2011 - Posted by | Budget, Congress, Conservatives, Debt Ceiling, Deficits, Democracy, Democrats, Dick Cheney, Economic Recovery, Economy, Elections, Federal Budget, GOP, Government, Ideology, Lawmakers, Politics, President Obama, Republicans, Right Wing, Teaparty | , , , , , ,

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