The U.S. National Debt Under President Barack Obama

The Great Recession and Stimulus

Barack Obama took office in the midst of the Great Recession, the most severe economic crisis since the Great Depression. The financial system was on the brink of collapse, unemployment was soaring, and tax revenues had plummeted. His first major act was the American Recovery and Reinvestment Act of 2009, a nearly $800 billion stimulus package of tax cuts, aid to states, and infrastructure spending designed to prevent a deeper economic collapse.

His administration also oversaw the continuation of the TARP bank bailouts and a separate bailout for the auto industry. These emergency measures, combined with the automatic rise in safety-net spending (like unemployment benefits) and collapse in tax revenue, led to record deficits exceeding $1 trillion for his first four years.

The Affordable Care Act and Lingering Costs

The signature legislative achievement of his presidency was the Patient Protection and Affordable Care Act (ACA), a sweeping healthcare reform law. While the ACA was projected to be largely paid for over the long term, its implementation involved significant upfront federal spending.

Throughout his term, the U.S. continued to fund the wars in Iraq and Afghanistan. Furthermore, a compromise with Republicans in 2010 extended most of the Bush-era tax cuts, preventing a tax increase but also ensuring lower government revenues than would have otherwise occurred. As the economy slowly recovered, deficits began to shrink from their record highs but remained historically large.

The Debt in Numbers

President Obama added more to the national debt in dollar terms than any president before him. Supporters argue this was a necessary response to the unprecedented economic crisis he inherited, and that these actions prevented a second Great Depression. Critics contend that the stimulus and other spending programs were inefficient and unnecessarily expanded the debt.