The United States Department of the Treasury reported today that the annual deficit has fallen to its lowest reported levels since 2008, reaching $680 Billion. In fiscal year 2012, for example, it was $1.1 Trillion.
Many fiscal conservatives blame the Obama administration for the increase in deficit spending in 2009, more than tripling the 2008 figures. In fact, the reason the 2009 deficit rose so dramatically is that the current administration included the unreported expenditures of the Afghan and Iraqi wars, keeping all deficit spending on the books, rather than leaving the spending unreported, which was the common practice of the previous administration.
With nearly $1 Trillion suddenly shifted from unreported to reported expenditures, the deficit, as reported, rose in 2009 to an alarming $1.4 Trillion. The principal sum of the increase was attributed to military costs relating to the Iraq and Afghan wars.
The decrease in expenditure in Fiscal Year 2013 is attributed to exceptional cost-savings actions by the current administration as well as sequestration mandated cost cutting.
If the current economy continues to rise, slowly and steadily, it’s possible the deficit will reverse in as little as three years, resulting in longer-term stability and a boom period, with increased tax revenues and lowered outstanding national debt.
Politically, economic stability is favorable to the President’s party in local, state and national elections in 2014 and 2016. Polls show increasing faith in the Democratic party as the party of fiscal responsibility, while the Republicans, severely hurt by the recent government shutdown and attempts to de-fund Obamacare have been consistently dropping in the same polling category, one they’ve held favorably for decades.