In July of 2008, the Congressional Budget Office estimated that the federal deficit would be $482 billion for FY2009 and probably higher because it did not yet include all DoD estimates for Iraq and Afghanistan that year. Then the mortgage mess came home to roost and TARP and the Porkulus on its heels and the next thing you know we see a $1.4 trillion deficit for 2009, a $1.3 trillion deficit for 2010, and at least a $1.6 trillion deficit estimated for 2011. That's just the beginning.
Last March Obama put out a spending plan that projected $7.2 trillion in additional deficits over the next ten years. The CBO took a look at that and decided it would be more like $9.5 trillion. I don't trust the CBO, but I trust Obama even less, so I'll go with the CBO number. The bad news here is that for all of the wailing and rending of garments over the Republican plan to try to cut $4 trillion off the deficits over the next ten years, that's less than half of what we need to do to get to a balanced budget.
Shit.
The federal government will take in roughly $2.2 trillion this year and spend $3.8 trillion. To not run a deficit at all you would have to raise federal taxes by more than 70% over current levels. And there you would reach a point where government at all levels is collecting and spending the equivalent of 40% of GDP every year. That's right, local, state, and federal government will tax and spend $6.1 trillion this year compared to a total GDP of roughly $15 trillion.
How many more taxes can we impose on an ever dwindling number of taxpayers before we kill the private sector engine that really pays for it all? And as I noted at Mr. B.'s place there, before anyone talks about historically low levels of taxes based on GDP, talk to me about the historically low level of taxpayers first.
I'm not against closing some tax loopholes and ending some subsidies, but I want to see some real spending cuts first. And if we need to means test Social Security and Medicare to get there then lets get on with that.
I realize that a balanced budget is a long way off and the debt limit will have to be raised. But Democrats have to get serious, and I mean dramatically more serious, about spending cuts or one of two things will happen: They spend us right into insolvency the way Greece is headed now, or they get thrown out of power. I figure they have until the end of the year to make their choice. By then everyone will know what the score is and it will be our choice in November.
Recent Comments