Here are eight of the biggest myths that are out there:
1) President Obama tripled the deficit.
Reality: Bush's last budget had a $1.416 trillion deficit. Obama's first budget reduced that to $1.29 trillion.
True. TARP was expensive. This ignores that over 700 Billion of that last Bush year deficit has since been paid back in the TARP program.
2) President Obama raised taxes, which hurt the economy.
Reality: Obama cut taxes. 40% of the "stimulus" was wasted on tax cuts which only create debt, which is why it was so much less effective than it could have been.
Partially true. It was the only really effective part of the stimulus, the problem was the tax cuts were specifically targeted and thus less effective.
3) President Obama bailed out the banks.
Reality: While many people conflate the "stimulus" with the bank bailouts, the bank bailouts were requested by President Bush and his Treasury Secretary, former Goldman Sachs CEO Henry Paulson. (Paulson also wanted the bailouts to be "non-reviewable by any court or any agency.") The bailouts passed and began before the 2008 election of President Obama.
Um... No:
February 2009: Obama stimulus $200 billion for Fannie Mae and Freddie Mac
March 2009: Obama stimulus $30 billion for AIG
March 2009: Obama Stimulus $15 billion for small business lending
March 2009: Obama Stimulus $1 trillion to get toxic assets off bank’s troubled asset sheets
March 2009: Obama Stimulus $22 billion for Big 3 Automakers Chrysler and GM
The reality is Obama did bail out the banks. While TARP was relatively successful and money was paid back for that particular bail out, others continued to happen and are ignored by too many. Where did that money that got paid back go? I surmise a bit of it was on the above.
4) The stimulus didn't work.
Reality: The stimulus worked, but was not enough. In fact, according to the Congressional Budget Office, the stimulus raised employment by between 1.4 million and 3.3 million jobs.
Partially true. The CBO by writ must assume that the numbers submitted to them by Congress are accurate, depending on reports from this source is foolish in the extreme. And yes, I will say the same when the numbers reflect something the Rs wanted them to reflect. Garbage in = Garbage out.
Portions of the stimulus did work, previously I even stated that the tax cuts were one of those.
5) Businesses will hire if they get tax cuts.
Reality: A business hires the right number of employees to meet demand. Having extra cash does not cause a business to hire, but a business that has a demand for what it does will find the money to hire. Businesses want customers, not tax cuts.
Businesses will hire when they are assured that the rules and the incentive will remain. There is nothing in the stimulus to give them that reassurance. The reality is, higher taxes will never cause any business to do better and be willing to hire. Such incentives must be directly linked to hiring.
6) Health care reform costs $1 trillion.
Reality: The health care reform reduces government deficits by $138 billion.
Again, based on false numbers fed to the CBO who MUST assume that the assumptions of Congress are fact. Now this "$1 Trillion" number came from the CBO report of $940 Billion. Actual cost estimates have climbed up since then, and the supposed "savings" in premiums failed to materialize.
7) Social Security is a Ponzi scheme, is "going broke," people live longer, fewer workers per retiree, etc.
Reality: Social Security has run a surplus since it began, has a trust fund in the trillions, is completely sound for at least 25 more years and cannot legally borrow so cannot contribute to the deficit (compare that to the military budget!) Life expectancy is only longer because fewer babies die; people who reach 65 live about the same number of years as they used to.
The reality is that any money collected for Social Security is spent in the General Funds and has been 100% that way since Clinton and the R Congress pretended they were "balancing the budget". They did this on the back of Social Security. The promise to pay is part of the $13 Trillion in debt we owe.
8) Government spending takes money out of the economy.
Reality: Government is We, the People and the money it spends is on We, the People. Many people do not know that it is government that builds the roads, airports, ports, courts, schools and other things that are the soil in which business thrives. Many people think that all government spending is on "welfare" and "foreign aid" when that is only a small part of the government's budget.
I'd like to see somebody say that spending takes away from the economy, do you have a link?
This stuff really matters.
If the public votes in a new Congress because a majority of voters think this one tripled the deficit, and as a result the new people follow the policies that actually tripled the deficit, the country could go broke.
If the public votes in a new Congress that rejects the idea of helping to create demand in the economy because they think it didn't work, then the new Congress could do things that cause a depression.
If the public votes in a new Congress because they think the health care reform will increase the deficit when it is actually projected to reduce the deficit, then the new Congress could repeal health care reform and thereby make the deficit worse. And on it goes.
Too bad you fell for talking points rather than looking into the facts of the matter.
