Infographic Of The Day: Who Created This Debt Nightmare?

We're in a pretty bad fix. But the trend-line is looking good. Now if we could only address the real problems.

To judge only by cable news, the debt problem that the United States is facing threatens to destroy the entire universe RIGHT AFTER THE COMMERCIAL BREAK. But how bad is it, in historical context? And, more importantly, what's driving the debt?

The talented folks at Elefint Designs sent us a rather detailed chart that attempts to tease some of these questions apart. And perhaps the most surprising thing is that we're actually starting to bend the curve of debt growth.

[Click to enlarge]

As you can see in the chart above, the debt is in fact at levels not too far off their historical highs, which resulted from the cost of World War II. (And in that time period, it was the great economic boom of the 1950s which swelled the amount of taxes collected by the government -- and in turn helped us out from under the debt.)

But the most surprising thing is revealed in the very tail end of that chart, which represents the last couple of years:

The debt growth is actually slowing -- which is the precise opposite of what you'd expect if you're listening to all the screaming cable-news morons. We're not in a good place by any means, and the debt isn't going down quite yet -- but we're no longer seeing hockey-stick growth.

What the graph doesn't quite flesh out is how the debt got to be so bad. The short answer? The wars started by President George W. Bush and his tax-cuts for Americans making over $250,000 a year. All of this is laid out rather brilliantly in this chart from The New York Times:

Winding down those wars and those tax cuts does indeed look like the smartest thing we could do to begin addressing the debt -- after all, they were the two things that we just did to create this debt. If this is truly the most pressing issue in the land -- as the GOP would have you believe -- why wouldn't you simply undo them?

But it's a truly bizarre thing that we almost never hear about any of this: Washington has been very happy to have a food fight involving Social Security and Medicare reforms which will never happen. (Here, both political parties here have been equally bad, with the Republicans proposing extraordinary cuts and the Democrats usually insisting on no cuts whatsoever. On the tax cuts, Republicans have been happy to say that they're "just" responsible for $700 billion in lost revenue.)

If you were looking to blame President Obama for something, it would be this: He folded like a leaf during the debate over extending the Bush tax cuts for the top 2% of income earners. And that eliminated his administration's only real chance to raise revenues -- and his own best chance to say that he was dealing seriously with the budget shortfalls we're experiencing.

Washington's lack of seriousness about the problem looks incredible when you see these charts. And there's plenty of blame to spread among both parties.

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16 Comments

  • Jonathan Clark

    My man, you should really go back and start with Econ 101 - and stop relying on the NY Times for data... 'cause your data on the national debt (and who's responsible) is a just a little off.

  • Niklasgang

    Statistics and damn statistics! The second chart is totally misleading. From a cursory glance, Obama is the one that has expanded the wars in Afghanistan and Libya; the Republican are tring to reduce non-defense discretionary spending; bank tarp has mostly been paid, except for the auto loans which were Obama's doing; and the stimulus one was pushed and passed by democratic majorities in bith chambers of congress. Lastly, Obamacare is not even mentioned.

  • @DWDevelopments

    I love looking at charts when I invest in stocks but if I was to invest in this company It looks to be closing in on a breakout to the up side.  Formed a good base and then right around Regan it began making its move, had a minor correction under Clinton but Bush got us right on tract!  
    Unfortunately you can't hear the sarcasm in type.

    Jobs must be created, so revenue can be raised, along with RESPONSIBLE SPENDING, to achieve Debt reduction. 

    My problem with the whole cut taxes on them so they can make jobs is where are the jobs the taxes have been cut for 8+ years and the jobs have been going away for about the same time, go figure (if I have t pay employees does that reduce my profit or taxable income?).  

    Please remember before you get angry that all this is an opinion... and yu know about opinions ...  

  • abel2

    Stop reading too much into the infographic, it's not a tell-all and your bashing of its creator undermines your potential opinion.

    Nothing as complicated as the debt we are in now can in anyway be reversed or drastically changed in one presidential term, so most of those statements are null.  It's obviously easier to destroy than it is to create and from the massive slope of the tangent on the tail end of Bush's term that is readily apparent.  What is also apparent is that the slope lessened at every point after that, (read:  including when dems controlled the house and senate). 

    No one person is to blame for all the mess we are in, and until people can actually recognize that and work together for a compromise instead of bickering, and thus doing nothing constructive, then we will continue to wade in the mire. 

     And it looks like, after reading the comments, that you may want to put on your floaties on and grab a beer.

  • fastmichelle.com

    What's missing from this graphic is GDP growth or some other measure of how the economy was performing at the same time.
    Spending - or saving - doesn't happen in a vacuum.

    Until a context is included this is just political.

  • Matthew Scharpnick

    Wow.  This has been a spirited debate, which is not surprising considering the subject matter. 

    I just wanted to say thanks to everyone for your thoughts.  To those of you that said you enjoyed the infographic, thanks for your comments.  Thanks also to Cliff for running this, and for taking all the criticism in stride.  

    There certainly are many stories that can emerge from this data, and it's likely that people from different political persuasions will focus on different data points.  Hopefully everyone can agree that spending is complicated, and that no single president or member of congress ever has total control over it.  Blaming a single person or party may have its place in this discussion, but it's certainly not the whole story.

    Maybe I am idealistic, but I also hope that we can explore these kinds of topics together with patience when we think someone is off in their analysis.  Not because I have a strong desire to sing Kumbaya, but because the debt is a really important issue that effects us all, and it's worth thinking carefully about it.  

    It seems more helpful if we can debate these ideas in ways that have the potential to do more than just polarize.

    Anyway, just wanted to weigh in.  Thanks to everyone for your contributions.

    Matt

  • justkiddingnobutseriously

    [sigh] yes, the Dems have failed miserably to get things done but stop having selective memories and do try to remember that it's primarily due to the GOP's lack of brains that's causing all the headache and pain in the first place. clinton was by no means angelic but at least he kept our finances in order and we actually had a surplus under his administration.

  • Peter Fleckenstein

    Cliff, your design work is good. However, your accompanying op-ed is way off. I would suggest that you go back and read the U.S. Constitution. The U.S. Congress has the Constitutional purse strings and is the branch that creates laws.

    You should also remember that from the beginning of 2007 to Nov 2008 Congress was controlled, both House and Senate by the Democrats. Additionally Obama was a Senator then too. So he can't really inherit something he was an active operator in.

    You should also remember that from Nov 2008 until Nov 2010 Obama & Dems controlled the House, Senate, and the White House.

    You should also remember that Dem Senator Harry Reid and his Dem-Controlled Senate have not only failed, but openly refused to create a budget for the last 815+ days.

    One last item you should remember and it's illustrated in your graphics - Spending has gone up since 1960 regardless of whether Republicans or Democrats control Congress.

    Please Cliff. Stick to design sir.

  • PhantomSoul

    Holy Democrat-Controlled-Congress-Catastrophe, Batman!  Forget about the President; this graphic, at least since 1980, makes it pretty clear that Democrats running Congress equals fiscal disaster.

  • Austin

    I always thought al qaeda had something to do with the war we are currently fighting. And I also always thought that it was Congress who declared wars. Apparently I've missed something.

    I wish you would stick to reporting on business and leave the political opinion out of it. Strike two for you Cliff.

  • Olde English

    I just wrote a lengthy response to the first two posts, but then stopped and realized this is a website about design and no one cares about other people's political beliefs. 

  • Pogo

    Love the Elefint Infographic. Can't stand Cliff's misreading of it in his clueless editorial, including the widely debunked NYT graphic. Instead of Bush-Obama, look at who was running Congress (which contols the purse-strings) when the debt shot up. And now we are bending the debt curve down. Gee, what changed?

  • ATLNative

    So tired of the Bush-to-blame argument. Bush was fiscally flawed, absolutely. We're 3 years into Obama's presidency. And with 2 years of a democratically-congrolled congress, Obama should have fixed what he wanted to. Democrats certainly had the power.