The Deficit: Taxes Down or Spending Up ??

recession deficit

Two Main Deficit Facts

  1. It took off under Bush, because the recession caused it.
  2. Almost half of it is caused by people and business paying less taxes (because they have less income to tax).

Specifics

  • Income tax payments dropped 51% for corporations and 23% for people. So the government had to borrow.
  • Bush signed the FY 2009 budget and the TARP bank bailout.
  • But, the Recession itself caused most of the deficit.
  • Obama's job stimulus barely got started before the FY 2009 budget ended on Sept. 30, and by then the deficit had exploded.

Now see the three reasons spending has increased.