EDITOR OF REDSTATE
The Necessity of the Fight
Here’s something no one wants to talk about, whether Republican or Democrat. Well, I should not say no one, but pretty much every Republican and Democrat who participated in the terms of the debate over the debt ceiling has ignored this.
Government spending is going above 25% of GDP.
Tax revenue, up until the last two years has averaged 18.5% GDP.
Let’s give the Democrats, for the sake of argument, their Clinton tax increases back. The 1998 to 1999 years saw the highest amount of federal revenue come in. But it was only in the 21% of GDP range.
In fact, 1945 and 1999 are the only two years I can find where tax revenue into the federal government surpassed 20%.
In other words, with the economy firing on all cylinders, only twice has revenue into the federal treasury been over 20% of GDP and spending has now gone well above 20% of GDP.
Today the Senate will vote on the compromise debt ceiling plan. If the plan is implemented to the letter as intended, we will add $12 trillion in debt over the next decade.
Democrats are convinced that they can keep squeezing blood from turnips and get more tax revenue. They can’t. History shows us that. Wealth flight will happen or people will find it cost effective to shelter income.
So if tax revenue, in the very case, is going to max out around 20%, it seems even were the Republicans to concede tax increases, the Democrats are going to have to concede massive spending cuts — much more massive in terms of GDP than tax increases.
They’ll obfuscate. They’ll distract. But history will not be denied.
This is why conservatives must keep pushing for more and more. Both the GOP and the Democrats are in denial about the very real issue — government spending is exceeding its ability to take in revenue to fund the leviathan and at some point the leviathan will come crashing down on us, if we are not first consumed by it.