Ryan Budget: Balancing with More Taxes
Paul Ryan released his budget proposal for FY 2014 today, and as expected, it will balance within 10 years. Let me first say that this budget would be superior to the status quo a million times over. Medicaid and Food Stamps would be block granted to the states and Medicare would be subject to at least some free market reforms. Most importantly, it defunds the | Read More »
As predicted: California’s 1Q revenues dropping back to earth. Hard.
Which is to say: as predicted by me. I had a feeling that California’s surprisingly high tax revenues in January were due to people rushing through existing taxable transactions before that state’s new rates kicked in; and lo! …I seem to have been correct. The surge of revenue that showed up unexpectedly in state coffers last month may well be offset by a revenue dip | Read More »
The Fork In The Road Which Lead Us To The Fiscal Cliff
The Fiscal Cliff is a problem. We typically blame people not named us when problems occur. It’s easier and less painful than solving the problem. Here the problem is that the current US President and Congress (The US Senate in particular)* have both spectacularly failed in their management of the national fisc.
If we decided to solve America’s fiscal issues, it wouldn’t hurt to mine some historical data. Since 1950, the United States Government has averaged expenditures proportional to 19.61% of the same year GDP with a standard deviation of 2.25%. Our government has booked revenues equivalent to 17.65% of same year GDP with a standard deviation of 1.26%. If both events occurred at random, we’d have a 6.07% chance of a Federal Budget actually balancing if the spending and the revenues were determined at random.** This would suggest that we’ve set up a systemic and nasty spending problem despite pious insistence otherwise.
Read More »