Econbrowser commenter Mark Sadowski lays it out very well (IMO):

Since this is a never ending debate about facts that rarely if ever change I'll repeat some past points:

1) What kind of party control contributes the most to fiscal responsibility:

In my opinion, fiscal responsibility mainly involves reducing the public debt as a percentage of GDP. (Anything less is unsustainable.) Since the end of WW II we've had 63 Federal budgets (FY 1947-FY 2009). If you consider the FY 2002 budget the product of a united Republican government (a Republican congress passed the tax cut) and FY 2003 the product of a divided government you have the following breakdown. Thirtynine budgets were the product of a divided government with 31 having Republican presidents and 8 having Democratic presidents. Twentyfour budgets were the product of united government with 19 having Democratic presidents and 5 having Republican presidents.

The Federal public debt increased as a percentage of GDP in 24 of those fiscal years.(It did not increase during the transitional quarter in 1977.) Eighteen of these budgets were the product of divided government and the remaining six were the product of united government. So although 38.1% of all of the budgets were a product of united governments only 25% of the budgets which resulted in an increase in the public debt were the product of a united government. It seems if reducing the public debt is your goal, then a united government is at least slightly preferable to a divided government.

The worst possible combination is a united Republican government. Three out of the five budgets passed by a united Republican government (60%), an admittedly small sample, resulted in an increase in the Federal public debt as a percent of GDP. The next worst combination was divided government with a Republican president. Eighteen out of 31 budgets passed (58.1%) increased the public debt. Only 3 out of the 19 budgets that were the product of united Democratic government (15.8%) increased the public debt. And none of the 8 budgets passed by a divided government with a Democratic president increased the public debt.

If there is a party of fiscal responsibility it sure ain't the Republicans.

2) What was the fiscal situation that Obama actually inherited?

According to the CBO's January 2009 estimate for FY 2009, outlays were projected to be $3,543 billion and revenues were projected to be $2,357 billion, leaving a deficit of $1,186 billion. These estimates were made before Obama took office, based on existing policy, and did not take into account any actions that Obama might implement:

http://www.cbo.gov/ftpdocs/106xx/doc10640/10-2009-MBR.pdf

Now fast forward to the end of FY 2009, which ended on September 30, 2009. According to CBO, it ended with spending at $3,515 billion and revenues of $2,106 billion for a deficit of $1,409 billion.

Thus the deficit came in $223 billion higher than projected, but spending was $28 billion and revenues were $251 billion less than expected. Thus more than 100 percent of the increase in the deficit between January 2009 and the end of FY 2009 is accounted for by lower revenues. Not one penny was due to higher spending.

The revenues were lower to a large extent because of tax cuts included in ARRA. According to the JCT, these tax cuts reduced revenues in FY 2009 by $98 billion over what would otherwise have been the case. This is important because your position has consistently been that tax cuts and only tax cuts are an appropriate response to the economic crisis.

3) What are the specific legislative changes that have contributed to our current fiscal situation and which administration was responsible for them?

FY 2001 was Clinton's last budget. The surplus was $128 billion. Net interest was $230 billion. The effect of off budget items (SS and PS) was $161 billion. Thus the on-budget primary surplus was $128 billion + $230 billion - $161 billion = $197 billion.

Now EGTRRA (2001 tax cut) subtracted $61 billion from revenues in FY 2001 so Bush actually inherited a $258 billion on-budget primary surplus.

Now fast forward to FY 2009 (Bush's last budget). The deficit was $1413 billion. Net interest was $187 billion. The effect of off budget items was $137 billion. Thus the on-budget primary deficit was $1413 billion - $187 billion + $137 billion = $1363 billion.

Now ARRA (the fiscal stimulus) added $84 billion to spending and subtracted $98 billion from revenues so Obama actually inherited a $1181 on-budget primary deficit.

So how much did our fiscal situation get worse under Bush? Well $1181 billion + $258 billion is $1439 billion. And how much of this was legislated changes? Well the Bush tax cuts (EGTRRA and JGTRRA) subtracted $364 billion from revenue in FY 2009. TARP (the financial bailout) and Fannie and Freddie added $249 billion to spending. The wars in Afghanistan and Iraq added $178 billion to spending. Medicare part D added $51 billion to spending. Homeland Security added $52 billion to spending. So all told legislated changes under Bush added $894 billion to the deficit in FY 2009. That's nearly five times the contribution of ARRA to the FY 2009 deficit.

Now, let's fast forward again to estimates of FY 2013 (the last budget of Obama's first term). The CBO projects that the deficit will be $704 billion. The net interest is forecast to be $325 billion. And the effect of off budget items will be $88 billion. Thus the on-budget primary deficit is forecast to be $467 billion.

So how much is our fiscal situation projected to get better during Obama's first term? Well $1181 billion - $467 billion is $714 billion.

It is interesting to note that Obama's primary effect on the FY 2013 budget deficit comes from three things: 1) ARRA, 2) other recovery acts, and 3) PPACA (healthcare reform). What is the estimated effect of these three items? Well, ARRA is projected to add $53 billion to the deficit, other recovery acts are projected to add $11 billion to the deficit, and PPACA is projected to subtract $51 billion from the deficit. In short the major legislated changes under Obama will add a net of $13 billion.

In short, Obama's projected contribution to the deficit in the last budget of his first term ($13 billion) is 1.5% of Bush's contribution to his last budget ($894 billion).

This is why, when Republicans sound the alarms about a fiscal crisis I just have to laugh because if there is one, it was they who created it.

P.S. The on-budget primary deficit was $105 billion in FY 2007 (Bush's best year). He never ran on on-budget primary surplus his entire presidency. In contrast, Clinton had an on-budget primary surplus every budget of his presidency save his first (FY 1994).