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A Few Charts

If you take a look here, you’ll notice that it isn’t as if government debt is a new thing. We started in debt and have continued, more or less, in debt since then.

Make a note that this is spending as a percentage of GDP, not in current or past dollars. Also note, that each dip doesn't necessarily mean that debt was paid off, simply that GDP grew in relation to the amount of debt held.

So why is it that debt is now the subject of every newscast?

A few reasons. The biggest and most important one is that the majority of our current debt spending is not coming from temporary events. You can see the civil war, WW1, the great depression and WW2 quite clearly. Our current debt spending concern is in a large part due to blossoming agency budgets, not so much the wars or even the bailouts, as those things are temporary.Yes those things are extremely large, but that matters less than, “how much will be spent in each year going forward?”, the answer to that question is scary. Debt spending will far outpace both GDP growth and inflation, and that’s not a good thing.

For the less mathematically inclined, a trillion is a thousand billion or a million million.

It might just be me, but receipts seem to be higher than ever, even with the top tax rates at fairly reasonable levels (as compared to other countries). Tax receipts have simply not kept up with spending, or rather spending has outpaced growth.

So my question is, are the rich not paying their fair share or are elected officials spending more than their fair share? You know who isn’t paying their fair share? Those who paid not one dime into the tax system. Those who actually made money filing their taxes. As long as we question who has what share to pay, it’s only fair to note that the top 50% pay not only their fair share, but the entire share, fair or otherwise.

Cut spending to 2008 levels and keep it there for 10 years, that’s my advice. Let the economy catch up to spending, rather than taxing away an ever bigger piece of a slowly growing pie.

Categories: Uncategorized
  1. 2013/08/25 at 03:12

    Wow that was strange. I just wrote an really long comment
    but after I clicked submit my comment didn’t show up. Grrrr… well I’m not writing all that over again.
    Anyways, just wanted to say excellent blog!

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