Is government spending too high or simply underfunded? Should we raise taxes to cover the annual shortfall of $1.5 trillion, or should we cut spending? On top of this, the Obama administration favors more spending ("investments"), not less.
What's the right answer? Do we curb our spending or adopt a national lifestyle of increasing debt loads?
As usual, the answer is in the data ...
Our spending trend is alarming:
However, we'd expect spending to rise year-over-year simply due to inflationary pressure. Can we create a level view which reflects the true picture? The following graph does just that, showing federal outlays as a percentage of GDP for the last 60 years:
It turns out the historically "right" level of federal spending is 18-19% of GDP. The last two years reflect what us corporate chartists refer to as an out-of-control situation. To return to historic norms, we need to reduce the current budget by 25%, or over a trillion dollars annually. It turns out this is approximately equivalent to our budget shortfall.
We have the answer ...
Balancing the budget is the right thing to do. Now ... not ten years from now.
2 comments:
The question isn't if we should balance the budget, the question is how. If by "balance" one suggests cutting taxes for the richest 5% of the population while cutting off the poor, unemployed, ill and aged then (IMHO) all you have is a robber-baron mentality with barly an ounce of morality.
If one suggests "balance" without touching military spending, then even that ounce of morality is missing.
But so far, left-wing, right-wing (two parts of the same bird, by the way)neither has shown even the ability to count, so I'm not holding my breath.
Those arguments are out of date. The top 5% already pay the lion's share, and that easy solution has been tapped dry. The defense budget, at 22%, is way off its' peak of 60%. No program should be protected and everyone should pay in. X% of a little is a little; x% of a lot is a lot.
Post a Comment