History often consists of what people want to believe happened rather than what actually happened. Nowhere is this truer than in the rosy views political partisans entertain about their favorite president.
Consider two examples I came across this week.
In the first, a left-wing commentator was bashing the Bush administration. He contrasted Bush budget deficits with “enormous budget surpluses under Clinton.”
Federal budget deficits and surpluses are confusing, because the government tabulates a couple of different measures of what is included. The major difference is whether the deficit in question includes Social Security revenues and spending. Also, projections of future deficits get much more press than actual tabulations.
In any case, the national debt numbers show what happened. During the Clinton administration, the national “debt held by the public” fell in four consecutive fiscal years, 1998-2001. The total decline was from $3.77 trillion to $3.32 trillion, about 12 percent. These are the budget surpluses often cited.
But in such “held by the public” numbers, a surplus in the Social Security accounts covers up substantial deficits in general spending. Changes in a different measure, the “gross debt,” show total spending compared to total revenues. Over the same fiscal years, this gross debt grew from $5.37 trillion to $5.77 trillion.
The upshot is that the Clinton administration did see modest budget surpluses by one measure but modest deficits by another. Yes, the fiscal situation was less bad than for any other president since 1968. But there were no “enormous” surpluses.
The other example was someone asserting that Ronald Reagan “dramatically cut the size of the federal government.” This is not true if one looks at federal spending as a proportion of the value of total output or GDP.
Over the past 50 years, federal spending has averaged 20.2 percent of GDP. For the eight fiscal years administered by Reagan, the average was 22.3 percent, the highest of any administration after World War II.
Reagan talked about reducing the size of government. But he also wanted increased defense spending. He never enjoyed a majority in both houses of Congress. The upshot was that he got the defense spending he wanted, and Democrats in Congress kept the social spending they wanted.
The result was the largest federal government, relative to the economy, that we ever had outside a major war.
In terms of federal civilian employment, there was little change during the Reagan years.
Again, there are differing definitions of who is a federal employee. By the most flattering definition, Reagan cut government by 29,000 employees over eight years. But using the same measure, Clinton cut 200,000. In both cases, real change was less than it appeared, as both largely involved substituting contractors for employees.
Presidents often do good things, but seldom as much as their supporters come to believe.
© 2008 Edward Lotterman
Chanarambie Consulting, Inc.