NEW YORK (MainStreet) — With the Congressional debt ceiling deadline just five days away, the bipartisan debate in Washington is heating up. And as a U.S. default draws near, political pundits are determined to point out who’s to blame for the massive debt incurred during the past decade.
Perhaps in a move to settle the issue, the White House released a visual report Tuesday depicting the U.S. national debt. The graphic provides a detailed breakdown of the staggering $12.7 trillion the nation has added to its debt load in 10 years.
Unsurprisingly, the White House graphic points to Bush administration policies for more than half of the $12.7 trillion total.
The government had a budget surplus starting off the millennium estimated to be somewhere around $230 billion. But instead of using the surplus to pay off foreign debt, the graphic illustrates that the Bush administration chose to cut taxes, resulting in a $3 trillion deficit. The deficit was exacerbated by Bush’s domestic and defense spending policies, as well as the war efforts in Afghanistan and Iraq, which taken together, account for an additional $3.1 trillion.
Conversely, Obama took the office facing $7 trillion in debt. In his 31-month term, his policies have accounted for $1.4 trillion, the graphic illustrates, or approximately 11% of the federal deficit. The most costly policy under Obama was the $800 billion Recovery Act, which came at the heels of the financial crisis in September 2009.
The graphic doesn’t include debt incurred by the health care bill passed earlier this year, which is projected to either save $118 billion or cost the U.S. $1.3 trillion over the next 10 years, depending on whether you ask a Democrat or Republican (or tea party member).
Still, the single largest contributor to the massive deficit cannot be attributed to either president’s policies. The economic downturn, responsible for a drop in gross domestic product and a decrease in national revenues, heightened unemployment rates and Americans’ subsequently lower disposable incomes has put a proverbial nail in the U.S. Treasury’s coffin. To wit, the White House attributes roughly one-third of the debt, or an aggregated $4.1 trillion, to be a direct result of the recession.
As debates have escalated on Capitol Hill and an agreement between parties seems more and more unlikely, global markets have been sinking and everyday consumers are beginning to worry about how a government default could affect issues close to home, such as student loan and credit card rates.