Tell House Speaker John Boehner that the sky is, in fact, blue, and he will invariably say it’s purple if he’s convinced himself that that’s the case. Unless, of course, he’s colorblind. Doubtful. Then again, many of us might be colorblind since some have claimed that Boehner actually isn’t white but a drab shade of orange.
But I digress. Boehner is positively convinced that the GOP’s plan to trim the federal budget and right the economy is the best measure for the nation. A Goldman Sachs report from last month says otherwise.
Here’s a snippet from a recent L.A. Times article:
Spending cuts approved by House Republicans would act as a drag on the U.S. economy, according to a Wall Street analysis that put new pressure on the political debate in Washington.
The report by the investment firm Goldman Sachs said the cuts would reduce the growth in gross domestic product by up to 2 percentage points this year, essentially cutting in half the nation’s projected economic growth for 2011.
The analysis, prepared for the firm’s clients, represents the first independent economic assessment of the congressional budget fight, which could lead to a government shutdown as early as next week.
The Republican plan to slash $61 billion from the budget would cut estimated growth for this year in half.
Ever the stubborn one, Boehner, through a spokesman, said the Goldman Sachs report represented “the same outdated Washington mind-set” as the American Recovery and Reinvestment Act of 2009 that pumped about $800 billion in federal funds into the economy during the worst recession since the Great Depression. While many experts at the time said the measure did not go far enough — Paul Krugman at the time said
… it’s widely believed that political considerations led to a plan that was weaker and contains more tax cuts than it should have — that Mr. Obama compromised in advance in the hope of gaining broad bipartisan support.
— the influx of new capital into the economy obviously helped to stabilize markets. If the GOP had gotten its way at the time, presumably by cutting taxes for the wealthiest among us, supporting more deregulation and simply allowing the economy to self-correct, there’s no telling how deep the ship would have sunk.
Below is a graph from the AP on the budget deficit (or surplus) since the Reagan years. The budget under Obama’s watch is estimated to begin moving closer toward the center in a few years. Clinton presided over the only surplus in recent memory, after inheriting a deficit from Mr. Trickle Down’s heir apparent, H.W. Bush.