As much as don't like deficit spending (owe that to my conservative philosophy), the President stuck to his chosen path of "spend a bunch and cut taxes a bunch" in the hope that the economy wouldn't completely tank in late 2001. During mid-September, 2001, there was very real fear of a complete economic meltdown - maybe worldwide depression. Although there will always be disagreement about the health of our economy in the five and a half years, GDP has continued to grow ever since September 11, even though oil has moved to and stayed at prices nobody thought possible.
The President's strategy worked - sort of. Huge government spending (meaning deficits) has helped stoke the economy (so did the auto companies with their post-September 11 offers of 0% financing that went on for a long time), just like economics textbooks would predict.
Huge tax cuts (like the expanded child tax credit, among others) have put cash in the pockets of the middle class, and they've shown no aversion to spending that cash (again, helping stoke the economy).
Unemployment has remained relatively low, interest rates have stayed relatively low, the stock market (where the monied class does their predicting about the future economic health of the country) has recovered quite nicely. The Dow hit a new all-time high yesterday.
Housing prices have exploded all over the country yet other than the usual suspects of fuel, medical costs and higher education - inflation remains low.
It's been very popular for many to argue very strenuously that we should have increased taxes and cut spending in the wake of September 11 - even though many economists would say that action could have slowed the economy - maybe into another recession. With the fear in 2001 and 2002 that September 11 itself might cause a worldwide recession or depression - who in their right mind would take that path? Not the risk averse President Bush.
I can't blame the President for wanting to avoid that at all costs; even if it meant abandoning the typical conservative position that deficits were inherently "bad." The last five years have shown that big deficits don't cause immediate harm (just like was shown in the 1980s with Reagan's huge deficits). Maybe the anti-deficit hawks will someday be proven correct (that big deficits really do cause harm). So far, however, the critics of big deficits are sounding an awful lot like that boy who got off on yelling "WOLF!" at every opportunity.
