I Want the Facts: Ray Griggs' I Want Your Money reviewed

From Media Matters In his documentary I Want Your Money, filmmaker Ray Griggs employs an all-star cast of right-wing misinformation propagators who fill the film with long-parroted and thoroughly debunked conservative myths about U.S. economic history and President Obama's economic policies. Griggs falsely claims Obama "doubled" the FY2009 deficit Griggs: "[I]t's clear that Bush did not leave President Obama a $1.4 trillion deficit. It looks like President Obama and the Democrats Congress more than doubled it." Griggs compares the deficit in Obama's first year to that of Bush's last in office, claiming that "President Obama and the Democratic Congress more than doubled" Bush's deficit. From I Want Your Money: GRIGGS: What's the true story behind the $1.4 trillion deficit Obama claims he inherited in 2009? Well, let's take a closer look at that. During President Bush's last full year in office in 2008, the federal deficit was $600 billion. Obama steps in and adds quite a bit to next year's budget. First, he and the Democratic Congress pass the stimulus bill -- $787 billion, which $242 billion was spent in '09. Subtract that from the $1.4 trillion, and you get a deficit of right around $1.1 trillion. But the Democrats also passed a $410 billion omnibus spending bill. Oh yeah -- take off $60 billion for the auto industry. Then there was the $8 billion expansion of the SCHIP health insurance program, and another $3 billion for Cash for Clunkers, and I'm sure I did not find all the new spending. But it's clear that Bush did not leave President Obama a $1.4 trillion deficit. It looks like President Obama and the Democratic Congress more than doubled it. $1.2 trillion of $1.4 trillion deficit was already projected before Bush left office. The CBO projected on January 7, 2009, that, including spending authorized under the Bush administration for the Troubled Asset Relief Program (TARP) and government takeovers of Fannie Mae and Freddie Mac, the deficit that year would total $1.2 trillion. According to the CBO, the actual FY 2009 deficit was $1.4 trillion. NY Times: Obama policies are "responsible for only a sliver of the deficits." According to a budget analysis done by The New York Times, "Mr. Obama's main contribution to the deficit is his extension of several Bush policies, like the Iraq war and tax cuts for households making less than $250,000. Such policies -- together with the Wall Street bailout, which was signed by Mr. Bush and supported by Mr. Obama -- account for 20 percent" of the increase between the FY2008 and FY2009 budget deficit estimates. The Times analysis also stated that 70 percent of the increase was due to a combination of economic hardships, including "the fact that both the 2001 recession and the current one reduced tax revenue, required more spending on safety-net programs and changed economists' assumptions about how much in taxes the government would collect in future years" and "new legislation signed by Mr. Bush ... like his tax cuts and the Medicare prescription drug benefit." CBPP: "By the time CBO issued its new projections on January 7, 2009 -- two weeks before Inauguration Day -- it had already put the 2009 deficit at well over $1 trillion." An analysis of the federal budget deficit by James Horney and Kathy Ruffing of the Center on Budget and Policy Priorities shows that "the events and policies that have pushed deficits to these high levels in the near term, however, were largely outside the new Administration's control." Film pushes falsehood that health care reform will dramatically boost federal deficit Voegeli falsely claims health care reform will increase the federal deficit. In I Want Your Money, The Claremont Institute's William Voegeli said of President Obama: "So he's complaining about the deficits, but then doubling them, and now with health care tripling, and has plans for unending deficits." CBO has consistently said that health care reform law will reduce deficit by $143 billion over next ten years, and by more in second decade. The CBO determined in March that the two health care bills signed into law that month "would produce a net reduction in federal deficits of $143 billion over the 2010-2019 period." The CBO estimated a further reduction in the second decade after enactment "with a total effect during that decade in a broad range around one-half percent of GDP." In an August 24 letter to Sen. Mike Crapo (R-ID), CBO director Doug Elmendorf "confirm[ed]" those findings: First, we can confirm the estimate of the overall impact on the federal budget of the major health care legislation enacted in March. Specifically, the Congressional Budget Office (CBO) and the staff of the Joint Committee on Taxation estimated that enactment of the Patient Protection and Affordable Care Act, or PPACA (Public Law 111-148) and the Health Care and Education Reconciliation Act of 2010 (P.L. 111-152) will produce $143 billion in net budgetary savings over the 2010-2019 period.1 That figure includes $124 billion in net savings for the health and revenue provisions of both laws and $19 billion in net savings for the education provisions of the Reconciliation Act. Griggs uses misleading statistic to minimize effect of stimulus Griggs misleads with "$250,000 per job" figure. From I Want Your Money: OBAMA: That is why the single most important part of this economic recovery and reinvestment plan is the fact that it will save or create up to 4 million jobs. GRIGGS: Broken down, that's $250,000 per job. Calculation ignores other tangible benefits stemming from the package. In judging the package solely by dividing the Act's "price tag" by the number of jobs created or saved, Griggs ignores other tangible benefits stemming from the package, such as infrastructure improvements and investments in education, health, and public safety. An November 2, 2009, Associated Press "fact check" article reported that a similar statistic, determined by "divid[ing] the stimulus money spent so far by the estimated number of jobs saved or created" is "highly misleading," in part because that calculation "ignores the value of the work produced": First, the naysayers' calculations ignore the value of the work produced. Any cost-per-job figure pays not just for the worker, but for material, supplies and that worker's output - a portion of a road paved, patients treated in a health clinic, goods shipped from a factory floor, railroad tracks laid. Calculation ignores effect of increased GDP. As Baker and Nobel laureate Paul Krugman have noted, such calculations also ignore that increased GDP caused by the package results in higher federal tax receipts, which, as Baker noted in his blog for American Prospect, "should be subtracted from the cost to the taxpayers": Okay, let's do the reporters' work for them. First, where do the Republicans get this number? They divide the the $825 billion cost of the stimulus by 3 million jobs that President Obama had originally pledged. Their arithmetic is right but both numbers are wrong. First, the projections from the Obama team is that their package will create 4 million jobs, not 3 million. Furthermore, it is important to note that this over 2 years, not one year. The cost is also wrong, or at least misleading. If we assume that the stimulus will work as planned, then it will boost GDP by approximately 1.5 times the amount of spending or $620 billion a year. If GDP rises by this amount, then it will translate into roughly $155 billion a year in higher taxes/lower spending than if we didn't do the stimulus. This is money that should be subtracted from the cost to the taxpayers. So, if net out the increased revenue from the growth generated by the stimulus we end up with a 2-year cost of $515 billion which will generate roughly 8 million job-years. That comes to about $65k per job year, less than one-fourth of the Republicans' number. Similarly, in his January 25 New York Times column, Krugman noted that "the net cost will be as little as $60,000 once you take into account the fact that a stronger economy means higher tax receipts": As the debate over President Obama's economic stimulus plan gets under way, one thing is certain: many of the plan's opponents aren't arguing in good faith. [...] First, there's the bogus talking point that the Obama plan will cost $275,000 per job created. Why is it bogus? Because it involves taking the cost of a plan that will extend over several years, creating millions of jobs each year, and dividing it by the jobs created in just one of those years. It's as if an opponent of the school lunch program were to take an estimate of the cost of that program over the next five years, then divide it by the number of lunches provided in just one of those years, and assert that the program was hugely wasteful, because it cost $13 per lunch. (The actual cost of a free school lunch, by the way, is $2.57.) The true cost per job of the Obama plan will probably be closer to $100,000 than $275,000 -- and the net cost will be as little as $60,000 once you take into account the fact that a stronger economy means higher tax receipts. Griggs excuses Bush's spending increases by falsely suggesting it was mainly for war in Iraq Griggs claims spending "went up more under Bush than any other president in the last 40 years, due mostly to the war in Iraq." From I Want Your Money: GRIGGS: Unfortunately [Bush's] economic policies were not so good. He got half the Reagan equation right: the needs for tax cuts to spur economic growth. But he and the Republican Congress missed the other half: control spending. Spending went up more under Bush than any other president in the last 40 years, due mostly to the war in Iraq. The total federal budget increased by one trillion dollars from 2001 to 2006. Spending on Iraq accounts for approximately 21 percent of the increase in spending under Bush. According to "The Budget and Economic Outlook: An Update," published by Congressional Budget Office in August 2010, between FY2003, when the Iraq war began, and fiscal year 2009, the last budget submitted by the Bush administration, spending on the war for defense activities, indigenous security forces, diplomatic operations and foreign aid in Iraq, along other services and activities, totaled $648 billion. A comparison between CBO's budget outlook from January 2001 and historical data from Bush's budget for FY2009 shows that spending during the Bush administration had risen by a total of $3.16 trillion above CBO's projection. This means that Iraq accounts for approximately 20.8 percent of increased spending during the Bush administration. The data: Looking Forward FY2002 Actual, as of FY09 Budget Increase over final Clinton projections $ spent on Iraq Percent of increase due to Iraq FY2002 $1,923 $2,011 $88 $0 FY2003 $1,984 $2,160 $176 $49 27.84% FY2004 $2,056 $2,293 $237 $88 37.13% FY2005 $2,137 $2,472 $335 $59 17.61% FY2006 $2,184 $2,655 $471 $95 20.17% FY2007 $2,243 $2,730 $487 $123 25.26% FY2008 $2,320 $2,931 $611 $140 22.91% FY2009 $2,396 $3,107 $711 $94 13.22% Total: $17,243 $20,359 $3,116 $648 20.80% CBO: Budget and Economic Outlook: An Update - August 2010 The Budget and Economic Outlook: Fiscal Years 2002 to 2011 Budget of the United States Government Fiscal Year 2009 - Historical Tables All dollar amounts in Billions Moore falsely claims "[g]overnment spending does not create jobs" Moore: The stimulus plan is one of the great hoaxes of all time. It did not work." From a clip of Wall Street Journal senior economics writer Stephen Moore in I Want Your Money: MOORE: The stimulus plan is one of the great hoaxes of all time. It did not work. Government spending does not create jobs. It just creates debt, and it creates a lot of inflation, and that's what we're seeing right now. And so this $800 billion spending plan that Barack Obama and the Democrats passed in 2009 was a catastrophe. CEA: ARRA raised employment "by between 2.5 and 3.6 million." In its fourth quarterly report on the American Recovery and Reinvestment Act [ARRA] of 2009, the White House's Council of Economic Advisers (CEA) stated that "as of the second quarter of 2010, the ARRA has raised employment relative to what it otherwise would have been by between 2.5 and 3.6 million. These estimates are broadly consistent with the direct recipient reporting data available for 2010:Q1." CBO estimates stimulus increased employment by up to 3.3 million jobs. The nonpartisan Congressional Budget Office (CBO) estimated in August that as of the second quarter of 2010, the stimulus "[i]ncreased the number of people employed by between 1.4 million and 3.3 million." IHS/Global Insight estimated job impact of 1.7 million by early 2010. PolitiFact.com stated on February 17 that "[u]sing updated estimates provided to PolitiFact, IHS/Global Insight estimates that 1.7 million jobs will be created or saved by the first quarter of 2010." The CEA report also cites this estimate from IHS/Global Insight. Moody's economy.com estimated 1.9 million additional jobs by early 2010. The PolitiFact post further stated that "[u]sing updated estimates provided to PolitiFact ... Moody's economy.com estimated that 1.9 million jobs will be created or saved" by the first quarter of 2010. The CEA report also cited this estimate from Moody's economy.com. Macroeconomic Advisers estimated 1.8 million additional jobs by early 2010. The CEA report stated that Macroeconomic Advisers estimates that the Recovery Act raised employment by 1.8 million as of the second quarter of 2010, citing an analysis provided to CEA. Moody's study shows "the effects of the fiscal stimulus alone appear very substantial, raising 2010 real GDP by about 3.4%." A recent study by Alan Blinder, a member of President Clinton's Council of Economic Advisers, and Mark Zandi, the co-founder of Moody's Economy.com, simulated the "macroeconomic effects of the government's total policy response" to the recent economic downturn and found that "the effects of the fiscal stimulus alone appear very substantial, raising 2010 real GDP by about 3.4%, holding the unemployment rate about 1½ percentage points lower, and adding almost 2.7 million jobs to U.S. payrolls." Wall Street Journal: 70 percent of economists surveyed said stimulus helped. The Wall Street Journal reported on March 12 that 38 of the 54 economists it surveyed "said the American Recovery and Reinvestment Act boosted growth and mitigated job losses, while six said the legislation had a net negative effect." ABC News: Most on panel of economists "think the economy would be worse" without the stimulus. ABC News reported on February 18 that "most" of the economists on its panel "think the economy would be worse today without the big aid package, which totaled $787 billion and was signed into law by President Obama on Feb. 17, 2009." NABE: 83 percent say stimulus raised GDP. A February survey of 203 members of the National Association for Business Economics (NABE) found that, "[e]ighty-three percent believe that GDP is currently higher than it would have been without the 2009 stimulus package (ARRA)." History revised: Film claims Reagan cut taxes for all, ignores his tax increases Gingrich, Wilson: Reagan cut taxes, resulting in economic boom. From I Want Your Money: GINGRICH: So Reagan came in and dramatically lowered the tax rates in the United States, which was still a 70 percent top rate when he became president. And he steadily brought it down, and the result was a tremendous boom, but he combined the tax cuts with two other things: He really dramatically reduced regulation, there was a lot less red tape on business when Reagan was president; and he was a cheerleader for entrepreneurship. He liked business people; he liked entrepreneurs; he liked small business, and he made people feel good about going into business. [...] PETE WILSON (former California governor): Ronald Reagan understood, so what he did was, he gave the American people tax cuts, and it worked like a charm. In fact, he gave us, I think 90, over 90 months of consecutive economic growth. Reagan raised taxes repeatedly after 1981, including "the largest tax increase in U.S. history" at the time. In a July 9 article titled "What Would Reagan Really Do?" Newsweek reported that, in 1982, Reagan was responsible for "the largest tax increase in U.S. history," and he repeatedly increased taxes in the years following: It's doubtful, for example, that a contemporary Reagan figure would seek to solve every problem by cutting taxes. In 1981, the former California governor swept into office promising to slash taxes to their lowest-ever levels--and with the Economic Recovery Tax Act, that's exactly what he did. When Reagan arrived in the White House, the top marginal tax rate was 70 percent; by 1987 it was 38.5 percent (roughly the same as the rate under Bill Clinton). But while today's conservatives continue to call for lower taxes in the name of the Gipper--Grover Norquist's Americans for Tax Reform, for example, pressures Republicans to sign a "no new tax" pledge every election cycle--there's simply no evidence in Reagan's record to suggest that he would've followed his signature achievement by pushing for ever lower rates. In fact, much the opposite. In 1982, Reagan agreed to restore a third of the previous year's massive cut. It was the largest tax increase in U.S. history. In 1983, he raised the gasoline tax by five cents a gallon and instituted a payroll-tax hike that helped fund Medicare and Social Security. In 1984, he eliminated loopholes worth $50 billion over three years. And in 1986, he supported the progressive Tax Reform Act, which hit businesses with a record-breaking $420 billion in new fees. When it came to taxation, there were two Reagans: the pre-1982 version, who did more than any other president to lighten America's tax burden, and his post-1982 doppelgänger, who was willing (if not always happy) to compensate for gaps in the government's revenue stream by raising rates. Today, a truly Reaganesque leader would recognize (like Reagan) that the heavy lifting was finished long ago; last year, for instance, taxes fell to their lowest level as a percentage of personal income since 1950. And he would dial back the antitax dogma as a result. [emphasis added] Krugman: Reagan lowered income tax but raised payroll taxes, increasing total tax burden for "many middle- and low-income families." In a 2004 New York Times column, Krugman wrote: But Ronald Reagan does hold a special place in the annals of tax policy, and not just as the patron saint of tax cuts. To his credit, he was more pragmatic and responsible than that; he followed his huge 1981 tax cut with two large tax increases. In fact, no peacetime president has raised taxes so much on so many people. This is not a criticism: the tale of those increases tells you a lot about what was right with President Reagan's leadership, and what's wrong with the leadership of George W. Bush. The first Reagan tax increase came in 1982. By then it was clear that the budget projections used to justify the 1981 tax cut were wildly optimistic. In response, Mr. Reagan agreed to a sharp rollback of corporate tax cuts, and a smaller rollback of individual income tax cuts. Over all, the 1982 tax increase undid about a third of the 1981 cut; as a share of G.D.P., the increase was substantially larger than Mr. Clinton's 1993 tax increase. [...] Mr. Reagan's second tax increase was also motivated by a sense of responsibility; or at least that's the way it seemed at the time. I'm referring to the Social Security Reform Act of 1983, which followed the recommendations of a commission led by Alan Greenspan. Its key provision was an increase in the payroll tax that pays for Social Security and Medicare hospital insurance. For many middle- and low-income families, this tax increase more than undid any gains from Mr. Reagan's income tax cuts. In 1980, according to Congressional Budget Office estimates, middle-income families with children paid 8.2 percent of their income in income taxes, and 9.5 percent in payroll taxes. By 1988 the income tax share was down to 6.6 percent; but the payroll tax share was up to 11.8 percent, and the combined burden was up, not down. Economics revised: Documentary attributes '80s boom to tax cuts As cited above, I Want Your Money speakers Gingrich and Wilson credit Reagan's tax cuts for the 1980s economic boom. In reality, economists credit the economic expansion during that period to lowered interest rates. Federal interest rates dropped throughout early 1980s recession, but are already currently at near-record lows.The recession began in July 1981 and ended in November 1982. The federal funds rate peaked at 20 percent in late May 1981 and dropped to 9.5 percent by mid-October 1982, while the discount rate peaked at 14 percent in early May 1981 and dropped to 9.5 percent in mid-October 1982. By contrast, the current federal funds rate is between zero percent and .25 percent, while the primary discount rate is at 0.75 percent and the secondary discount rate is at 1.25 percent. CBO: "Lower interest rates after mid-1982 permitted the recovery to begin." An August 1983 CBO report, titled "The Economic and Budget Outlook: An Update," concluded that "[l]ower interest rates after mid-1982 permitted the recovery to begin": The Economy At Mid-1983 Recovery started in December 1982 from the deepest postwar recession, the second of two since 1980. Both recessions were brought on by monetary restriction aimed at bringing inflation under control. Lower interest rates after mid-1982 permitted the recovery to begin. Real GNP grew at a 2.6 percent annual rate in the first quarter and at an 8.7 percent annual rate in the second quarter of 1983. The report concluded: "A dramatic decline in inflation, a fall in interest rates from levels that were extraordinarily high to levels that are merely high, and the stock market boom have contributed to the improvement in economic conditions." Reagan economist suggests interest rate cuts drove economic recovery. Michael Mussa, a member of Reagan's Council of Economic Advisers, wrote in an essay for American Economic Policy in the 1980s (University of Chicago Press, 1995) that when the Federal Reserve cut the discount rate a half percentage point on July 20, 1982, it "signal[ed] the beginning of what would become a four-and-a-half-year period of quite rapid monetary expansion. During this period, interest rates, both short and long term, would be driven significantly lower, and the U.S. economy would substantially recover from the devastation of both inflation and recession." Krugman: "Right now, the interest rate is zero. The Fed can't rescue us this time, and that's why we can't do the things we did in the '80s." Nobel laureate Paul Krugman said during the February 6, 2009, edition of MSNBC's Morning Joe that "in 1982, when the economy was deeply depressed, the Federal Reserve said, 'OK, we've got to do something about this,' and they cut interest rates from 13 percent to around 7 percent and the economy took off." Krugman continued: "Right now, the interest rate is zero. The Fed can't rescue us this time, and that's why we can't do the things we did in the '80s. We have to have an approach that harks back to the things that worked very well in the first four years of the New Deal until Franklin Roosevelt was persuaded to go orthodox all over again." Similarly, in a January 14, 2009, Rolling Stone article headlined "Letter to Obama," Krugman wrote: Compare the situation right now with the one back in the 1980s, when [Paul] Volcker [then chairman of the Federal Reserve] turned the economy around. All the Fed had to do back then was print a bunch of dollars (OK, it actually credited the money to the accounts of private banks, but it amounts to the same thing) and then use those dollars to buy up U.S. government debt. This drove interest rates down: When Volcker decided that the economy needed a pick-me-up, he was quickly able to drive the interest rate on Treasury bills from 13 percent down to eight percent. Lower interest rates on government debt, in turn, quickly drove down rates on mortgages and business borrowing. People started spending again, and within a few months the economy had gone from slump to boom. Economists call this process -- from the Fed's decision to print more money to the resulting pickup in spending, jobs and incomes -- the "monetary transmission mechanism." And in the 1980s that mechanism worked just fine. This time, however, the transmission mechanism is broken. First of all, while the Fed can still print money, it can't drive interest rates down. Why? Because those interest rates are already about as low as they can go. As I write this letter, the interest rate on Treasury bills is 0.005 percent -- that is, zero. And you can't push rates lower than that. Moore claims the New Deal failed; economists say otherwise Stephen Moore claims in I Want Your Money that the New Deal "failed" because unemployment was "still 15 percent before World War II." However, New Deal programs slashed the unemployment rate by 10 percent, and economists attribute the slowed recovery to President Franklin Roosevelt's return to fiscal conservatism in 1937. Moore: New Deal failed, unemployment was still high before World War II. From I Want Your Money: MOORE: Well, one of the things that I find so frustrating is how the Left has rewritten the history books and written a fairy tale about what's actually happened in American history, and one of my favorite examples of this is the New Deal. Everyone thinks the New Deal was a great success, right? Franklin Roosevelt, all the programs that saved the economy during the Great Depression. Well, the reality is a little bit different from that fairy tale. If you look at the statistics, Franklin Roosevelt was elected president in 1932 during the depths of the Great Depression. He took office in 1933, launched the New Deal and all of these new programs. We doubled the amount of spending, we doubled the national debt over those years, and this was supposed to put America back to work, right? But the most amazing thing is eight years later, by 1940 right on the eve of World War II, eight years after we had put in place the New Deal, the unemployment rate in the United States was still 15 percent. That would be like 50 percent more Americans being unemployed than are today, and yet we still label the New Deal a success. [emphasis added] Krugman: Roosevelt was "eager to return to conservative budget principles ... precipitating an economic relapse that drove the unemployment rate back into double digits." In a November 10, 2008, New York Times column, Paul Krugman criticized "a whole intellectual industry, mainly operating out of right-wing think tanks, devoted to propagating the idea that F.D.R. actually made the Depression worse," and stated: The New Deal brought real relief to most Americans. That said, F.D.R. did not, in fact, manage to engineer a full economic recovery during his first two terms. This failure is often cited as evidence against Keynesian economics, which says that increased public spending can get a stalled economy moving. But the definitive study of fiscal policy in the '30s, by the M.I.T. economist E. Cary Brown, reached a very different conclusion: fiscal stimulus was unsuccessful "not because it does not work, but because it was not tried." This may seem hard to believe. The New Deal famously placed millions of Americans on the public payroll via the Works Progress Administration and the Civilian Conservation Corps. To this day we drive on W.P.A.-built roads and send our children to W.P.A.-built schools. Didn't all these public works amount to a major fiscal stimulus? Well, it wasn't as major as you might think. The effects of federal public works spending were largely offset by other factors, notably a large tax increase, enacted by Herbert Hoover, whose full effects weren't felt until his successor took office. Also, expansionary policy at the federal level was undercut by spending cuts and tax increases at the state and local level. And F.D.R. wasn't just reluctant to pursue an all-out fiscal expansion -- he was eager to return to conservative budget principles. That eagerness almost destroyed his legacy. After winning a smashing election victory in 1936, the Roosevelt administration cut spending and raised taxes, precipitating an economic relapse that drove the unemployment rate back into double digits and led to a major defeat in the 1938 midterm elections. What saved the economy, and the New Deal, was the enormous public works project known as World War II, which finally provided a fiscal stimulus adequate to the economy's needs. [New York Times,11/10/08] Baker: FDR "worried about the whining of the anti-stimulus crowd ... when the proper goal of fiscal policy should have been large deficits to stimulate the economy." In a January 6 column, Dean Baker, co-director of the Center for Economic and Policy Research, wrote: "In reality, any careful reading showed that the New Deal policies substantially ameliorated the effects of the Great Depression for tens of millions of people. The major economic failing of the New Deal was that President Roosevelt was not prepared to push the policies as far as necessary to fully lift the economy out of the Great Depression." Baker continued: Roosevelt was too worried about the whining of the anti-stimulus crowd that he confronted. He remained concerned about balancing the budget when the proper goal of fiscal policy should have been large deficits to stimulate the economy. Roosevelt's policies substantially reduced the unemployment rate from the 25 percent peak when he first took office, but they did not get the unemployment rate back into single digits. [Alternet.org, 1/6/09] DeLong: "[M]ore 'orthodox' economic policies" and attempt "to move the budget toward balance ... provide ample explanation of that downturn." In a November 17 post on his personal blog, University of California-Berkeley economics professor Brad DeLong wrote, "Private investment recovered in a very healthy fashion as Roosevelt's New Deal policies took effect. The interruption of the Roosevelt Recovery in 1937-1938 is, I think, wel [sic] understood: Roosevelt's decision to adopt more 'orthodox' economic policies and try to move the budget toward balance and the Federal Reserve's decision to contract the money supply by raising bank reserve requirements provide ample explanation of that downturn." Griggs falsely claims Bush's first veto was over spending As TPM Media documented, in I Want Your Money, Griggs falsely claims that Bush "brought out his veto pen for the first time in his Presidency" as a result of Democratic spending initiatives: GRIGGS: During the Democrats first two years in charge, the deficit went from 160 to over 400 billion dollars. The spending was so great that President Bush brought out his veto pen for the first time in his Presidency. BUSH: I kept my promise by vetoing it. CNN: "President Bush used his veto power Wednesday for the first time since taking... saying that an embryonic stem-cell research bill 'crossed a moral boundary.'" On July 19, 2006, CNN.com reported that President Bush had employed his veto "for the first time since taking office 5 1/2 years ago" on an embryonic stem-cell research bill.