A financial columnist named Rex Nutting recently triggered a firestorm of controversy by claiming that Barack Obama is not a big spender.

Here’s the chart he prepared, which certainly seems to indicate that Obama is a fiscal conservative. Not only that, it shows that Republicans generally are the big spenders, while Democrats are frugal with other people’s money.

In some ways, these numbers don’t surprise me. I’ve explained before that Bush bears a lot of blame for the big expansion in the burden of government this century, and I’ve specifically pointed out that he deserves the blame for most of the higher spending from the 2009 fiscal year (which began October 1, 2008).

That being said, Nutting’s numbers seemed a bit nutty. Sorry, couldn’t resist. Nutting’s numbers actually seem accurate, including the fact that he decided that Obama should be responsible for $140 billion of the spending in Bush’s last fiscal year (a number he may have taken from one of my posts).

But sometimes accurate can be misleading, so I decided to dig into the data.

I went to the Historical Tables of the Budget from the Office of Management and Budget, and I calculated all the numbers for every President since LBJ (with the exception of Gerald Ford, whose 2‑year reign didn’t seem worth including).

But I corrected a big mistake in Nutting’s analysis. I adjusted the numbers for inflation, using OMB’s GDP deflator.

As you can see, this changes the results. My chart isn’t as pretty, but based on the inflation-adjusted average annual growth of outlays, it shows that Clinton was the most frugal president, followed by the first President Bush and Obama.

With his guns-n-butter Keynesianism, it’s no big surprise that LBJ ranks last. And “W” also gets a very low grade.

But then I figured we should take interest payments out of the budget and focus on inflation-adjusted “primary spending.” After all, Presidents shouldn’t be held responsible for the national debt that existed before they took office.

Looking at these numbers, it turns out that Obama does win the prize for being the most fiscally conservative president in recent memory. Reagan jumps to second place. Clinton is in third place, which won’t surprise people who watched this video, while W and LBJ again are in last place.

But I don’t want my Republican friends to get too angry with me, so let’s expand our analysis. Just as we don’t want to blame Presidents for net interest payments on debt that was accrued before their tenure, perhaps we should make sure they don’t get credit or blame for defense outlays that often are dictated by external events.

There’s obviously room for disagreement, but most people will agree that the Cold War and 9/11 meant higher defense spending, regardless of which party controlled the White House. Similarly, the collapse of the Soviet Empire inevitably meant lower military expenditures, regardless of whether Republicans or Democrats were in charge.

So let’s now look at primary spending after subtracting defense outlays (still adjusting for inflation, of course). All of a sudden, Reagan jumps to the top of the list by a comfortable margin. LBJ and W continue to score poorly, but Nixon takes over last place.

But it’s also worth noting that Obama still scores relatively well, beating Clinton for second place. Inflation-adjusted domestic spending (which is mostly what we’re measuring) has grown by 2.0 percent annually during his three years in office.

So does that mean Obama deserves re-election? Well, before you answer, I want to make one final calculation. Just as there are good reasons to exclude interest payments because they’re not something a president can control, we also should take a look at what spending would be if we don’t count the cost of bailouts.

To be sure, these types of expenditures can be controlled, but if we go with the assumption that the federal government was going to re-capitalize the banking system (whether using the good FDIC-resolution approach or the corrupt TARP approach), then it seems that Presidents shouldn’t get arbitrary blame or credit simply because some financial institutions failed during their tenure.

So let’s take the preceding set of numbers and subtract out the long-run numbers for deposit insurance, as well as the TARP outlays since 2009. And keep in mind that repayments of TARP monies (as well as deposit insurance premiums) show up in the budget as “negative spending.”

As you can see, this produces a remarkable result. All of a sudden, Obama drops from second to second-to-last.

This is because there was a lot of TARP spending in Bush’s last fiscal year (FY2009), which created an artificially high benchmark. And then repayments by banks during Obama’s fiscal years counted as negative spending.

When you subtract out the big TARP spending surge, as well as the repayments, then Bush 43 doesn’t look quite as bad (though still worse than Carter and Clinton), while Obama takes a big fall.

In other words, Obama’s track record does show that he favors an expanding social welfare state. Outlays on those programs have jumped by 7.0 percent annually. And that’s after adjusting for inflation! Not as bad as Nixon, but that’s not saying much since he was one of America’s most statist presidents.

Allow me to conclude with some caveats. None of the tables perfectly captures what any president’s fiscal record. Even my first table may be wrong if you want to blame or credit presidents for the inflation that occurs on their watch. And there certainly are strong arguments that bailout spending and defense spending are affected by presidential policies rather than external events.

And keep in mind that presidents don’t have full power over fiscal policy. The folks on Capitol Hill are the ones who actually enact the bills and appropriate the money.

Moreover, the federal government is akin to a big rusty cargo ship that is traveling in a certain direction, and presidents are like tugboats trying to nudge the boat one way or the other.

But enough equivocating. The four different tables at least show more clearly which presidents presided over faster-growing government or slower-growing government. More importantly, the various tables provide a good idea of where most of the new spending was taking place.

We can presumably say Reagan and Clinton were comparatively frugal, and we can also say that Nixon, LBJ, and Bush 43 were relatively profligate. As for Obama, I think his tugboat is pushing in the wrong direction, but it’s only apparent when you strip out the distorting budgetary impact of TARP.

The lead article in the new Cato Policy Report is entitled “We Can Cut Government: Canada Did.” The article reviews Canada’s economic reforms since the 1980s, which have included free trade, privatization, spending cuts, sound money, large corporate tax cuts, personal tax reforms, balanced federal budgets, block grants, and decentralizing power by cutting the central government.

Those all sound like things we ought to pursue in America. The political systems of the two countries are different, but Canada’s pro-market reform lessons are universally applicable.

Canada’s reforms, for example, refute the Keynesian notion that cutting government spending harms economic growth. Canadian federal spending was cut from 23.3 percent of GDP in 1993 to 16.5 percent by 2000. Keynesians and their macro models would predict a crushing economic blow from such a spending reduction. They would argue that the “austerity” would slash “aggregate demand” and “take money out of the economy.”

Yet Canada’s spending cuts of the 1990s were coincident with the beginning of a 15-year economic boom that only ended when the United States dragged its neighbor into recession in 2009. As the government shrank in size during the 1990s, the Canadian unemployment rate plunged from more than 11 percent to less than 7 percent.

Canada still has a large welfare state, and its provincial governments are prone to overspending. However, its experience shows that even a modest dose of public sector austerity combined with pro-market reforms can lead to substantial gains in private-sector prosperity. American and European leaders still under the Keynesian spell should take note.

For more, see here and here.

Over at the Washington Post’s PostPartisan blog, Jonathan Bernstein discusses the rising influence of the “Ron Paul crowd” on Republican state party platforms. Bernstein cites a derisive piece from Ed Kilgore on a draft platform being considered by the Iowa Republican Party:

Now, a new group — the Ron Paul crowd — is taking over some formal GOP structures, including in Iowa. Ed Kilgore has a great post detailing some of the wackier things they’ve put in the official Iowa Republican Party platform — for example, eliminating the Agriculture Department. In Iowa. Oh, there’s plenty more, including phasing out Social Security and Medicare; overall, it has called for a federal government half the size of what Paul Ryan has advocated.

I don’t take issue with Bernstein’s contention that a platform like the one being proposed by the Iowa GOP would be a problem for most Republican politicians because the overall program “is just spectacularly unpopular with the general public.” I quickly scrolled through the hundreds of proposed “planks” in the platform and, as a libertarian, often found myself shaking my head and rolling my eyes. So it struck me as odd that of all the ideas in the platform that one could deem to be “wacky,” Bernstein chose to focus solely on planks that would cut – admittedly, dramatically – federal spending.

Bernstein continues:

Many libertarians have fooled themselves into believing that the American people are with them on their basic program, but if that were the case, Ron Paul would have been a viable presidential candidate, not someone who finds it hard to break 15 percent in primaries. Nor would the polling on government spending be mixed, with majorities for cutting spending overall (good for libertarians!) and for increasing spending on most programs (disaster for libertarians!).

I could be wrong, but I think most libertarians are aware that the average American favors spending cuts in general but is often less enthusiastic when the cuts are specified. And while Paul isn’t going to be the next president of the United States, his campaign has been successful in getting a lot more Americans to understand that the federal government needs to be downsized. Younger people in particular have been drawn to Paul’s limited government message. Paul was never going to win over the older folks who at the end of the day are primarily concerned with making sure that their Social Security and Medicare benefits aren’t touched. But the younger crowd is becoming increasingly aware that they’re eventually going to take it on the chin in order to maintain the federal government’s intergenerational redistribution schemes. Perhaps that’s what concerns people like Bernstein.

Circling back, proposing to eliminate the U.S. Department of Agriculture could be called a lot of things: provocative, controversial, dramatic, etc. But dismissing it as “wacky” is lazy. If Bernstein thinks that it’s a bad idea, then he should just say so (of course, my colleagues and I would argue otherwise).

For more “wacky” ideas, check out Downsizing the Federal Government.

After the Republicans took back control of the House following the November 2010 elections, the GOP leadership went with Kentucky Rep. Hal Rogers—a.k.a. “The Prince of Pork”—to chair the powerful House Appropriations Committee. I wrote at the time that “The support for Rogers from House Republican leaders is a slap in the face of voters who demanded change in Washington.”

I haven’t changed my mind.

A recent article in the New York Times offers up another reminder that the 30-year House veteran’s priority is to funnel taxpayer money back to his district—not downsize the federal government:

In the 1980s, the military had its infamous $800 toilet seat. Today, it has a $17,000 drip pan. Thanks to a powerful Kentucky congressman who has steered tens of millions of federal dollars to his district, the Army has bought about $6.5 million worth of the “leakproof” drip pans in the last three years to catch transmission fluid on Black Hawk helicopters. And it might want more from the Kentucky company that makes the pans, even though a similar pan from another company costs a small fraction of the price: about $2,500…The Kentucky company, Phoenix Products, got the job to produce the pans after Representative Harold Rogers, a Republican who is now the chairman of the House Appropriations Committee, added an earmark to a 2009 spending bill. While the earmark came before restrictions were placed on such provisions for for-profit companies, its outlays have continued for the last three years.

According to the Times, Phoenix Products’ president and his wife have been “frequent contributors” to Rogers’s political committee and the company has spent at least $600k on a DC lobbying firm since 2005. Those efforts apparently haven’t gone unrewarded as Rogers “has directed more than $17 million in work orders for Phoenix Products since 2000.”

Readers should keep this story in mind the next time a Republican member of Congress calls for a Balanced Budget Amendment, complains about the growth in government under Obama, and then argues against “dangerous defense cuts.” The bedtime story that Americans often hear is that the federal government must spend gobs of money on defense in order to “keep us safe from our enemies.” I once believed that story—and then I spent some time in the U.S. Senate watching policymakers treat military spending like any other pot of taxpayer money.

[See here for more on downsizing the Department of Defense.]

Over the years, I’ve strenuously objected to schemes that would enable international bureaucracies to levy taxes. That’s why I’ve criticized “direct funding” proposals, most of which seem to emanate from the United Nations.

• A scheme to let the United Nations tax services such as air travel.
• A proposal, pushed by George Soros and other statists, for U.N. taxes on things such as energy use.
• And, of course, the favorite of the big-government crowd, a global tax on financial transactions.

Interestingly, the American left is somewhat divided on these schemes. House Democrats have expressed sympathy for global taxes, but the Obama administration has come out against at least certain worldwide tax proposals.

Unfortunately, proponents of global taxes are like the Energizer Bunny of big government, relentlessly pushing a statist agenda. If the world economy is growing, it’s time for a global tax. If the world economy is stagnant, it’s time for a global tax. If it’s hot outside or cold outside, it’s time for a global tax (since “global warming” is one of the justifications for global taxation, I’m not joking).

Given this ongoing threat, I’m glad that Brian Garst of the Center for Freedom and Prosperity has put together a two-page Libertas explaining why international bureaucracies should not get taxing powers or direct funding.

…it would be imprudent to give international bureaucracies an independent source of revenue. Not only would this augment the already considerable risk of imprudent budgetary practices, it would exacerbate the pro-statism bias in these organizations. …The issue of taxing powers and direct funding has become an important issue because international organizations are challenging the contribution model and pushing for independent sources of revenue. The United Nations has been particularly aggressive in pushing for global taxes, seeking to expand its budget with levies on everything from carbon to financial transactions.

He then highlights one of the most dangerous proposals, a scheme by the World Health Organization to impose a “Solidarity Tobacco Contribution.”

Another subsidiary of the United Nations, the World Health Organization (WHO), is also looking to self-fund through global taxes. The WHO in 2010 publicly considered asking for global consumer taxes on internet activity, online bill paying, or the always popular financial transaction tax. Currently the WHO is pushing for increased excise taxes on cigarettes, but with an important condition that they get a slice of the added revenue. The so-called Solidarity Tobacco Contribution would provide billions of dollars to the WHO, but with no ability for taxpayers or national governments to monitor how the money is spent.

I have to give the left credit. They understand that few people are willing to defend tobacco, so proposing a global tax on cigarettes sounds noble, even though the real goal is to give the WHO a permanent stream of revenue.

Brian explains, though, why any global tax would be a mistake.

What all of these proposals have in common – in addition to their obvious intended use in promoting statist policies – is that they would erode the influence of national governments, reduce international accountability, promote waste, and undermine individual sovereignty and liberty. …Before long, international organizations will begin proposing – no doubt in the name of efficiency or reducing the burden on nation states – that affected taxpayers withhold and transfer taxes directly to the international body. This would effectively mean the end of the Westphalian system of sovereign nation states, and would result in a slew of new statist policies, and increased waste and corruption, as bureaucrats make use of their greater freedom to act without political constraint.

He concludes by noting that a global tobacco tax would be the proverbial camel’s nose under the tent. Once the statists succeed in imposing the first global tax, it will simply be a matter of time before additional levies are imposed.

National governments should not be fooled. Any sort of taxing power or direct funding for international bureaucracies would undermine national sovereignty. More importantly, it will further weaken the ability of people to influence and control the policies to which they are subjected. Moreover, once the first global tax is imposed, the floodgates will be opened for similar proposals.

The point about fiscal sovereignty is also important. Not because national governments are keen to adopt good policy, but because nations at least have to compete against each other.

Over the years, tax competition among governments has led to lower tax rates on personal and corporate income, as well as reductions in the double taxation of income that is saved and invested.

Politicians don’t like being pressured to lower tax rates, which is why international bureaucracies such as the Organization for Economic Cooperation and Development, acting on behalf of Europe’s welfare states, are pushing to undermine tax competition. But so long as there’s fiscal sovereignty, governments will have a hard time imposing confiscatory tax burdens.

Any form of global taxation, however, cripples this liberalizing process since taxpayers would have no safe havens.

One of the big stories from Washington is that there may be another fight over the debt limit, which could mean…gasp, hide the women and children…gridlock, downgrades, government shutdown, default, and tooth decay.

Okay, perhaps not tooth decay, but the DC establishment nonetheless is aghast.

Last year, there were actually two big confrontations between House Republicans and President Obama.

The first fight occurred early in the year and revolved around spending levels for the remainder of the 2011 fiscal year. I explained in February of that year how advocates of smaller government could prevail in a government shutdown fight, especially since the “essential” parts of the government wouldn’t be affected.

But I wasn’t surprised when GOPers buckled under pressure and accepted a deal that – at best – could be categorized as a kiss-your-sister compromise (and, as I noted elsewhere, our sister wasn’t Claudia Schiffer).

Then we had the big debt limit fight later in the year, which led to absurd claims that failure to increase the debt limit would lead to default – even though the federal government was collecting ten times as much revenue as was needed to pay interest on the debt.

Once again, Republicans were unable to withstand the demagoguery and they basically gave Obama what he wanted after agreeing to a “supercommittee” that was designed to seduce them into a tax increase.

Now the game is about to start over. It’s deja vu all over again, as Yogi Berra might say.

Here’s some of what the LA Times reported.

Republicans in Congress are heading into summer much the way they did last year — instigating a showdown with the White House by demanding massive federal budget cuts in exchange for what used to be the routine task of raising the nation’s debt limit to pay the government’s bills. House Speaker John A. Boehner (R‑Ohio) is doubling down on the strategy that ended in mixed results last year after the country came to the brink of a federal default before a deal was struck with President Obama. In that go-round, both sides saw their approval ratings with voters plummet and the nation’s credit was downgraded. …The risk for Republicans is not only in presenting another high-stakes showdown at a time when voters have grown weary of the gridlock in Washington.

The reporter’s assertion that the debt limit fight led to the downgrade is a bit silly, as I explain here, but that’s now part of the official narrative.

On a separate matter, I can’t help but shake my head with frustration that GOPers still haven’t learned that America’s fiscal problem is too much spending, and that deficits and debt are symptoms of that problem. Here’s another passage from the L.A. Times story.

“The issue is the debt,” Boehner said Sunday on ABC’s ”This Week With George Stephanopoulos.” “Dealing with our deficit and our debt would help create more economic growth in the United States and it would lift this cloud of uncertainty that’s causing employers to wonder what’s next.”

No, Mr. Speaker. The problem is spending, spending, spending.

Returning to the main issue, the debt limit isn’t the only big fiscal fight that may happen this year. There will also be the spending bills for the 2013 fiscal year, which starts on October 1 of this year. That will mean another fight, particularly since the left has no intention of abiding by the spending limit that was part of last year’s debt limit deal.

And if Republicans hold firm, that means another “government shutdown.” Though it really should be called a “government slowdown” since it’s only the non-essential bureaucrats who get sent home.

In any event, since I’m glum about the likelihood of anything good happening, let’s at least enjoy some good cartoons from Jeff MacNelly. He passed away a number of years ago, but these cartoons from the mid-1990s are just as applicable today as they were then.

These are amusing cartoons, so long as you don’t actually think about the fact that government is bloated in part because Washington is littered with programs, departments, and agencies that are filled with non-essential bureaucrats. And don’t forget that these bureaucrats are overpaid, getting, on average, twice the compensation of workers in the productive sector of the economy.

But I don’t want to end this post on a sour note, so here are some good jokes from the late-night comics about government shutdowns.

After declining during the prosperous 2000s, taxes in the EU have been going up in recent years. That is not good news – especially if the Europeans are trying to increase their anemic growth rates. It seems to me that a European “growth agenda” should include a tax cut.

So, why have the taxes gone up in Europe? They have gone up, because – contra Krugman — government spending has not, by and large, declined. In order to maintain the current level of expenditure, the EU governments (which are finding it more difficult to borrow in the financial markets) had to increase taxes.

PS: Look at the income tax and VAT rates in places like the UK, where the government first takes 50 percent of your income in taxes (actually that is going to decline to a “mere” 45 percent) and then hits you with a 20 percent tax on everything you buy – from a pack of chewing gum to a car. True, some of that money comes back to the Brits in the form of benefits, but their disposable income (i.e.: freedom to do with your earnings what you want) is quite low.