Politico Has Not Heard About the Collapse of the Housing Bubble and Economic Crisis

By Dean Baker
May 20, 2011 - 3:10pm ET

That is the conclusion that readers of a Politico article headlined, "budget surplus to deficit: how we got here," must conclude. This article attributes the increase in the deficit in the Obama years to increased spending coupled with tax cuts, only mentioning in passing at the end of the article that the single biggest factor in the rise of the deficit was the economic collapse. It fails to point out that virtually all of the additional spending and tax cuts by President Obama was carried through for the explicit purpose of counteracting the loss of private sector demand due to the collapse of the bubble.

It is absolutely inexcusable for a serious news organization to run a piece like this. The collapse of the housing bubble was by far the biggest economic disaster since the Great Depression. Complaining about the size of the deficit under President Obama, while only mentioning in passing the reason for the deficit, is like complaining about a city's use of water without mentioning that it had been trying to extinguish a massive fire.