Snap Fact #200 - Growth Rate of Federal Spending, Under President Obama, is Lowest in Sixty Years!

Post date: May 24, 2012 11:52:55 PM

Snap Fact #200

Growth Rate of Federal Spending, Under President Obama, is Lowest in Sixty Years!

The myth that has been widely promulgated is that President Obama has been spending taxpayers' money wildly, like no other president before him. 

The fact is that growth in federal spending is the lowest it's been since half a decade before Barack Hussein Obama was born.

The Republican propaganda machine has worked overtime on this one. Presently many people believe that President Obama has presided over a massive increase in federal spending. Recently, Governor Romney has called it “an inferno of spending that threatens our jobs, our businesses and our children’s future”. What nonsense!

The lie has been repeated so often that even many Democrats think it’s true. But it’s a complete falsehood! Even though there was a big stimulus bill under President Obama, the truth is that federal spending is rising at the slowest pace since Dwight Eisenhower brought the Korean War to an end in the 1950s – really, the slowest pace of federal spending growth since Dwight David Eisenhower occupied the White House! (See the chart below for Reagan to Obama spending growth rates)

A key aspect of budgeting often ignored for political convenience is the fact that the federal fiscal year begins Oct. 1. So by the time Obama stepped into the Oval Office, the budget for fiscal 2009 (which reflected a 17.9% increase) was already nearly one-third spent and expenditures for the rest of the year locked in. Obama added about $140 billion to the spending in 2009 through the stimulus plan. 

The big surge in federal spending happened in fiscal 2009, before Obama took office. For the four budget years Obama has had a direct hand in shaping, federal spending is on track to go from $3.52 trillion to $3.58 trillion. On an annual basis, that's 0.4 percent. When those dollars are inflation-adjusted, federal spending will actually have fallen during Obama's first four budgets at an average rate of 1.4 percent. 

What's also is true, of course, is that revenue hasn't kept up with spending. This is partly due to tax cuts pushed through by former President George Bush as well as the two wars he generated, and a record-busting recession that began before the Obama presidency. The impact of the recession directly affects millions of Americans who are out of work, underemployed, or working fewer hours, thereby reducing income tax revenues and putting immense pressure on expenditures for food stamps and unemployment insurance benefits.