Myth of Clinton Budget Surplus

A fascinating account of how borrowing from Social Security allowed the Clinton White House to claim budget surpluses when in fact each year of the Clinton administration resulted in a deficit. It's all fairly straightforward, which makes you wonder why the myth endures. The takeaway:

The only debt that matters is the total national debt. And the national debt went up every single year under Clinton. Had Clinton really had a surplus the national debt would have gone down. It didn't go down precisely because Clinton had a deficit every single year. The U.S. Treasury's historical record of the national debt verifies this.

A balanced budget or a budget surplus is a great thing, but it's only relevant if the budget surplus turns into a real surplus at the end of the fiscal year. In Clinton's case, it never did.

Thursday, October 9, 2008

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