# US Budget Deficit **URL:** \ **Category:** Great Debates\ **Created:** [February 2, 2010, 1:43am UTC](https://boards.straightdope.com/t/us-budget-deficit/527316 "2010-02-02T01:43:53Z")\ **Posts on this page:** 20\ **Page:** 2
**Author:** ![Mr\_Smashy](https://avatars.discourse-cdn.com/v4/letter/m/2bfe46/32.png) [@Mr\_Smashy](https://boards.straightdope.com/u/Mr_Smashy)\ **Post date:** [February 2, 2010, 9:40pm UTC](https://boards.straightdope.com/t/us-budget-deficit/527316/21 "2010-02-02T21:40:33Z")
> [@DanBlather](#): > > There is no solution based on budget cuts alone. It has to be a combination of tax hikes and spending cuts. +1. I’d add that the spending cuts _must_ include entitlement reform. Both Medicare/Medicaid, and Social Security, are larger than all of the rest of the non-defense budget put together (the part the ‘freeze’ is supposed to affect). If you aren’t willing to touch those third rails, then there’s no hope of avoiding the disaster. Also, to those who try to blame Bush for this situation (and Obama, if you’re listening, I count you among that number…) How many of those programs did the Democrats vote against? How many did Obama vote against while he was in the Senate? Even OEF and OIF were passed with Democratic votes, in same cases a lot of them. It’s bipartisan political malpractice. Maybe that’s what fueling the rise of the indy’s. ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [February 2, 2010, 9:47pm UTC](https://boards.straightdope.com/t/us-budget-deficit/527316/22 "2010-02-02T21:47:25Z")
> [@ajb867](#): > > I won’t claim to know anything about economics but this just sounds bad. When does the over spending stop, when things get better? Perhaps a bit too much of wishful thinking? It’s like the saying all bleeding stops eventually. A lot of spending, especially at the state level, comes from supporting those in trouble. More people with good jobs means less money spent on unemployment, welfare, and food stamps. At the same time revenue increases both from income taxes, sales taxes, and capital gains taxes on a rising market. One of the many reasons California is screwed is that Prop. 13 reduced the amount of tax revenue coming from stable property taxes, and increased the reliance on sales and income taxes, both of which crashed when unemployment increased and consumer spending flatlined. ---
**Author:** ![ajb867](https://avatars.discourse-cdn.com/v4/letter/a/f14d63/32.png) [@ajb867](https://boards.straightdope.com/u/ajb867)\ **Post date:** [February 2, 2010, 9:54pm UTC](https://boards.straightdope.com/t/us-budget-deficit/527316/23 "2010-02-02T21:54:30Z")
> [@Voyager](#): > > A lot of spending, especially at the state level, comes from supporting those in trouble. More people with good jobs means less money spent on unemployment, welfare, and food stamps. At the same time revenue increases both from income taxes, sales taxes, and capital gains taxes on a rising market. > > One of the many reasons California is screwed is that Prop. 13 reduced the amount of tax revenue coming from stable property taxes, and increased the reliance on sales and income taxes, both of which crashed when unemployment increased and consumer spending flatlined. Thank you for that Voyager! ---
**Author:** ![gonzomax](https://avatars.discourse-cdn.com/v4/letter/g/e8c25b/32.png) [@gonzomax](https://boards.straightdope.com/u/gonzomax)\ **Post date:** [February 2, 2010, 10:12pm UTC](https://boards.straightdope.com/t/us-budget-deficit/527316/24 "2010-02-02T22:12:47Z")
You want to fix the deficit? Then raise income taxes and corporate taxes. Close loopholes and get enough revenue to fix the mess. And of course. cut Defense spending in half just for a start. ---
**Author:** ![Happy\_Fun\_Ball](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/happy_fun_ball/32/17664_2.png) [@Happy\_Fun\_Ball](https://boards.straightdope.com/u/Happy_Fun_Ball)\ **Post date:** [February 2, 2010, 10:53pm UTC](https://boards.straightdope.com/t/us-budget-deficit/527316/25 "2010-02-02T22:53:20Z")
> [@gonzomax](#): > > You want to fix the deficit? Then raise income taxes and corporate taxes. Close loopholes and get enough revenue to fix the mess. And of course. cut Defense spending in half just for a start. How about eliminate corporate taxes entirely (there are so many loopholes its not really clear what the corporate tax rate is anyway) and then tax capital gains as income. ---
**Author:** ![Sage\_Rat](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/sage_rat/32/399_2.png) [@Sage\_Rat](https://boards.straightdope.com/u/Sage_Rat)\ **Post date:** [February 2, 2010, 11:27pm UTC](https://boards.straightdope.com/t/us-budget-deficit/527316/26 "2010-02-02T23:27:58Z")
> [@Dick\_Dastardly](#): > > What we really need to do is fix healthcare, that’s by far the biggest driver of the long term deficit. Get our health spending down to Canada’s level of GDP with a nice single-payer system and that’s the problem solved overnight. A single payer system isn’t the only solution–and I suspect wouldn’t work very effectively, as well as causing other problems–but I’ll agree that our number 1 solution is to cut spending on health care. ---
**Author:** ![Xema](https://avatars.discourse-cdn.com/v4/letter/x/9de053/32.png) [@Xema](https://boards.straightdope.com/u/Xema)\ **Post date:** [February 2, 2010, 11:37pm UTC](https://boards.straightdope.com/t/us-budget-deficit/527316/27 "2010-02-02T23:37:17Z")
> [@Duckster](#): > > One reality check is the Obama administration is putting it all on the table for everyone to see. Well, [not exactly](http://www.businessweek.com/news/2010-02-01/fannie-freddie-kept-off-budget-dividends-counted-update2-.html). > [@](#): > > White House budget director Peter Orszag delayed a decision on whether to bring the companies’ $1.6 trillion in corporate debt and $4.7 trillion mortgage obligations onto the federal budget. As the director of the Congressional Budget Office, Orszag criticized the Bush administration for keeping the 2008 rescue of the government-sponsored enterprises off budget. > … > For now, Obama’s budget plan classifies the GSEs as “non- budgetary” items and excludes them from being counted as federal liabilities… ---
**Author:** ![Dick\_Dastardly](https://avatars.discourse-cdn.com/v4/letter/d/c4cdca/32.png) [@Dick\_Dastardly](https://boards.straightdope.com/u/Dick_Dastardly)\ **Post date:** [February 2, 2010, 11:58pm UTC](https://boards.straightdope.com/t/us-budget-deficit/527316/28 "2010-02-02T23:58:59Z")
> [@Ruminator](#): > > I doubt it. > > Well, I guess it’s _theoretically_ possible for USA to have such a kick ass economy that it outpaces its debt servicing. This would be plausible if… > China & Japan wasn’t around as a economic powerhouse competitor. (Asia wasn’t as big a factor in 1950s.) > … or the USA discovered a brand new energy source (wealth) it could use to sustain itself and sell to other countries. Maybe tap into the Yellowstone Park thermal core to power the entire nation’s electricity grid and sell the excess energy to Canada. > … or the USA discovered a cure for cancer that it could export to other countries for a very steep price > … or a Eastern Hemisphere war erupts between Russia, Japan, China which leaves their economies devastated while the USA factories are selling them tanks and fighter jets for them to annihilate each other with. > > Since those pie-in-the-sky scenarios are not likely, I don’t think the USA can generate enough wealth to outpace and pay back its reckless credit-card binge. Yes, the USA has many resources and will still be generate wealth; the issue is that it doesn’t quantitatively generate _enough_ wealth to service the massive debt it created now. Let’s say we do nothing until 2020, by which time the national debt is expected to hit 80% of GDP. In 1950 it was 90% of GDP, but economic growth over the next decade meant that by 1960, even though government borrowing had increased between 1950-60, the debt: GDP ratio was down to 56%, or lower than it was in 2000. [http://www.census.gov/statab/hist/HS-49.pdf](http://www.census.gov/statab/hist/HS-49.pdf) ---
**Author:** ![Sam\_Stone](https://avatars.discourse-cdn.com/v4/letter/s/ecccb3/32.png) [@Sam\_Stone](https://boards.straightdope.com/u/Sam_Stone)\ **Post date:** [February 3, 2010, 12:05am UTC](https://boards.straightdope.com/t/us-budget-deficit/527316/29 "2010-02-03T00:05:43Z")
> [@Robot\_Arm](#): > > Can you back up any part of that post with any facts at all? > > Here are a few handy charts and graphs I found: > > [History of Federal Individual Income Bottom and Top Bracket Rates](http://www.ntu.org/main/page.php?PageID=19) > [U.S. Debt as a Fraction of GDP](http://en.wikipedia.org/wiki/File:USDebt.png) > [U.S. Budget Deficit, Debt Compared With GDP](http://www.npr.org/news/graphics/2009/feb/deficit/) > [Federal Tax Revenue & Expenses as % to GDP (FY 1981-2008)](http://en.wikipedia.org/wiki/File:Revenue_and_Expense_to_GDP_Chart_1993_-_2008.png) > > From these we can see that: > > Tax rates dropped dramatically in the early 80’s, and the debt steadily increased. > > Tax rates started going up in the late 80’s and early 90’s (though still less than they were in the 70’s), the deficit started to come down, and even the debt (as % of GDP) was reduced. Tax rates were lowered again in 2002, and the deficit and debt have both increased since. Tax rates are irrelevant to this particular discussion. Tax Revenues vs deficits vs future spending are what we’re talking about. > [@](#): > > In particular, I take issue with this statement:Look at that last graph. The purple bar graph represents revenue, the blue line represents expenses. Taxes went up in 1993, revenue started going up, and yet expenses fell and continued falling for the rest of the decade. Taxes were cut in 2002 and spending immediately started going up; exactly the opposite of what you predict. My point is that government revenue gains are met with increased spending rather than debt service. Obviously there is going to be a lag time - increased revenue translates into smaller deficits, which translates into less pressure to contain spending. Look at your last graph. See the big revenue bubble Clinton got? Look at what happened - a long trend of declining expenses reversed and government expenditures increased until there were big deficits again. The other part of what I said was that the problem is government spending, not government revenue. Looking at your last graph, if the size of government had been held to 2001 levels in terms of GDP, the budget would have been balanced in 2006 and there would have been a surplus in 2007. I will grant you that there was a drop in government revenue in the first years of the 2000’s, due to the double whammy of Bush’s tax cuts and the recession. But had the growth of government been held in check, fiscal sanity would have been restored with no increases in taxes. Or looked at another way, if Bush had never cut taxes, but the growth of government had continued as it did, the U.S. would still have been running deficits > [@](#): > > I’ve heard all sorts of slogans about the magic effects of taxes and revenue. “If we cut taxes, the growth will more than make up for the shortfall.” “We must cut taxes to starve the beast so the politicians will be forced to cut spending.” I’ve never seen any evidence for any of it. The only thing that has worked in my lifetime is to elect people who actually do something about spending, in good times and bad, and not just talk about it. Actually, the only thing that has really worked is to put Republicans in the Legislative Branch and Democrats in the White House. Divided government, with the purse strings controlled by Republicans who oppose Democrat policies, is the only thing that’s ever caused the growth of government to slow down. Recent history has taught us that whenever either party gains control of all branches of government, the stops come out and the spending goes wild. Here’s a graph for you, showing the growth of government spending over time: [U.S. Government Spending as % of GDP](http://www.mailings.com/images/local_gov_wp/gov-spending.gif). Notice that the only time the government actually shrank as a percentage of GDP was during the Clinton administration, when the Republicans controlled Congress and the ‘peace dividend’ came in. You also didn’t address my point that in many other countries, taxes have been raised repeatedly, to much higher levels than the U.S., and almost always with the promise that they would be used to cut the deficit. And yet, governments around the world are awash in red ink. There is an exception: Canada. We got our budget under control. We’ve been running surpluses for quite a long time, until the latest recession hit. So, did we solve our problem with major tax increases? Nope. We held the size of government to just slightly below the level of GDP growth, and slowly shrank it. Revenues stayed the same, so our deficits withered and became surpluses. We used the extra money to shore up our Social Security system, which is now actuarily sound. We then paid down our structural debt rather than spending the money on new programs. The fact that fiscal responsibility starts with spending control shouldn’t be a controversial position. The idea that you can let spending do whatever it does and solve your problem by simply taxing more money out of the economy is a fantasy. Now, I could accept doing both at the same time. In fact, at this point it’s probably the preferable way to go. If I were American, I would support a policy that included tax increases, so long as the tax increases were coupled with one-for-one spending cuts, and a bill with real teeth were passed forbidding the government to grow more than the rate of GDP growth until the budget was balanced. Obama’s budget is an example of the worst of what government does. He’s got lots of tax increases, big and little, in this budget. But his non-discretionary spending increases eat it all up, so he has a budget in which there is no end in sight for huge deficits. And that’s with the added revenue from the expired Bush tax cuts and the supposed new revenue from Cap and Trade thrown in. The current government has a big spending problem. It currently also has a revenue problem, but that will fix itself as the economy recovers and the Bush tax cuts are retired. No more tax increases are needed or desirable. He just needs to get spending under control. This is increasingly important in a globalized world, as other governments are discovering. You simply don’t have the luxury of hiking taxes on manufacturers and business any more. Capital is too fluid, and competition too fierce. Punish your productive sector any more, and you’ll find your export market crumbling. ---
**Author:** ![The\_Hamster\_King](https://avatars.discourse-cdn.com/v4/letter/t/8edcca/32.png) [@The\_Hamster\_King](https://boards.straightdope.com/u/The_Hamster_King)\ **Post date:** [February 3, 2010, 12:07am UTC](https://boards.straightdope.com/t/us-budget-deficit/527316/30 "2010-02-03T00:07:28Z")
> [@Mr\_Smashy](#): > > Both Medicare/Medicaid, and Social Security, are larger than all of the rest of the non-defense budget put together (the part the ‘freeze’ is supposed to affect). If you aren’t willing to touch those third rails, then there’s no hope of avoiding the disaster. I love the “non-defense” caveat. Let’s start by reining in our out-of-control MILITARY spending. Right now our defense budget is larger than the military spending of the rest of the world combined. That sort of extravagance is what broke the back of the Soviet Union and it will break our backs unless we’re willing to do something about it. ---
**Author:** ![Dick\_Dastardly](https://avatars.discourse-cdn.com/v4/letter/d/c4cdca/32.png) [@Dick\_Dastardly](https://boards.straightdope.com/u/Dick_Dastardly)\ **Post date:** [February 3, 2010, 12:08am UTC](https://boards.straightdope.com/t/us-budget-deficit/527316/31 "2010-02-03T00:08:51Z")
> [@Sam\_Stone](#): > > If raising taxes were the answer, the U.S. government would be awash in surplus. The government’s per-capita revenue today dwarfs what it was in the 1970’s or 1980’s, yet here are the deficits. > > The problem is that government spends money without limit, constrained only by the public’s distate for debt. In other words, they spend every nickel they’ve got, and then borrow as much as is politically palatable. If you raise taxes, you simply lower the pressure on politicians to constrain spending, and spending increases even faster. > > Look at the result of the boom years of the 90’s - the government realized hundreds of billions of dollars of savings from the end of the cold war, and record tax revenues because of the dot-com boom. It managed a surplus for a very short while, but then all the pressure to keep spending down vanished, and the size of government exploded. > > Tax increases will lead to a very temporary reduction in the deficit, followed by an even steeper increase in the size of govenrment, resulting in a government in even worse fiscal shape ten years from now as it is today. > > If tax increases were the answer, why are so many other countries that have much higher taxes than the U.S. still up to their eyeballs in debt? I guarantee almost every one of those tax increases was justified as a deficit-fixing measure. We had an budget surplus in 2000 but this has been turned into a record deficit by huge tax cuts and two unfunded wars along with an economic collapse brought about by eight years of pro-growth business-friendly policies. We’d still have a surplus or at least a balanced budget if we’d avoided the pro-growth policies, been less business friendly, avoided the tax cuts, hadn’t started two wars without raising taxes to pay for them. Here are the causes of the budget deficit according to the CBO : [![](https://farm3.static.flickr.com/2707/4191155977_7c1dd28e67_o.jpg) ](https://farm3.static.flickr.com/2707/4191155977_7c1dd28e67_o.jpg) When Clinton raised taxes back in 1993 the GOP, the Wall Street Journal etc. warned of impending economic collapse. Of course that didn’t happen. At the same time as taxes were raised spending was also kept under control too due to PAYGO laws brought in in 1993 also, and the combination of the two turned a record deficit into a record surplus in eight years. In 2001 the GOP cut taxes and scrapped PAYGO, allowing them to go on the biggest unfunded spending spree in history, creating the situation we have today. So really it’s down to prudent management of the economy versus insane ideologial management of the economy. ---
**Author:** ![Mr\_Smashy](https://avatars.discourse-cdn.com/v4/letter/m/2bfe46/32.png) [@Mr\_Smashy](https://boards.straightdope.com/u/Mr_Smashy)\ **Post date:** [February 3, 2010, 12:22am UTC](https://boards.straightdope.com/t/us-budget-deficit/527316/32 "2010-02-03T00:22:20Z")
> [@The\_Hamster\_King](#): > > I love the “non-defense” caveat. > > Let’s start by reining in our out-of-control MILITARY spending. That was [your guy’s](http://www.politico.com/news/stories/0110/31989.html) idea, not mine. > [@](#): > > The freeze would not apply to defense or foreign aid or spending on intelligence, homeland security or veterans. and then you said > [@](#): > > Right now our defense budget is larger than the military spending of the rest of the world combined. [All I could find was 2003 numbers - close but not quite](http://en.wikipedia.org/wiki/United_States_Department_of_Defense#Expenditures) > [@](#): > > According to the Stockholm International Peace Research Institute, in 2003 the United States spent approximately 47% of the world’s total military spending (if anyone has something more recent, bring it) > [@](#): > > That sort of extravagance is what broke the back of the Soviet Union and it will break our backs unless we’re willing to do something about it. Probably incorrect. [The DOD budget](http://www.heritage.org/Research/Features/NationalSecurity/images/chart_1.gif) as a percentage of GDP has been steadily declining since WWII and Korea. The answer, as others have said, is to grow the economy. ---
**Author:** ![Mr\_Smashy](https://avatars.discourse-cdn.com/v4/letter/m/2bfe46/32.png) [@Mr\_Smashy](https://boards.straightdope.com/u/Mr_Smashy)\ **Post date:** [February 3, 2010, 12:24am UTC](https://boards.straightdope.com/t/us-budget-deficit/527316/33 "2010-02-03T00:24:20Z")
One more interesting thing: Read [this](http://www.slate.com/id/2243295/) for a good overview of the budget situation. We’re spending ourselves into oblivion > [@](#): > > The most disturbing projection, though, is the deficit. If current trends continue, the annual deficit over the next 10 years won’t dip below $700 billion and will surge back to more than $1 trillion in 2020, according to the administration’s projections. That would add a total of $8.5 trillion to the national debt. The interest on that debt would balloon from less than $200 billion in 2010 to more than $900 billion in 2020. If you were hoping that reducing spending would help, William Galston of the Brookings Institution has bad news for you: “These projections assume that total spending for discretionary domestic programs will decline from $553 billion next year to $529 billion a decade later—a trajectory without precedent in modern U.S. history.” ---
**Author:** ![Robot\_Arm](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/robot_arm/32/18280_2.png) [@Robot\_Arm](https://boards.straightdope.com/u/Robot_Arm)\ **Post date:** [February 3, 2010, 12:37am UTC](https://boards.straightdope.com/t/us-budget-deficit/527316/34 "2010-02-03T00:37:28Z")
> [@Sam\_Stone](#): > > If raising taxes were the answer, the U.S. government would be awash in surplus. > > … > > If you raise taxes,… > > Tax increases will lead to… > > If tax increases were the answer,… > [@Sam\_Stone](#): > > Tax rates are irrelevant to this particular discussion. The U.S. raised taxes in the early 90’s and very soon we were awash in surplus. Temporarily, yes, but see my next point. > [@](#): > > My point is that government revenue gains are met with increased spending rather than debt service. Obviously there is going to be a lag time… In this case, the lag time was 8 years. I believe this had more to do with the change in administrations than with some automatic property of expenses to outpace revenue. But I’m really not sure we disagree all that much. > [@](#): > > But had the growth of government been held in check, fiscal sanity would have been restored with no increases in taxes. > [@Robot Arm](#): > > The only thing that has worked in my lifetime is to elect people who actually do something about spending, in good times and bad, and not just talk about it. I don’t think the Republican congress during the Clinton administration deserves as much credit as you seem to give it. The graph shows spending starting to come down in '91, and Republicans didn’t gain the majority in Congress until 1995. ---
**Author:** ![Sam\_Stone](https://avatars.discourse-cdn.com/v4/letter/s/ecccb3/32.png) [@Sam\_Stone](https://boards.straightdope.com/u/Sam_Stone)\ **Post date:** [February 3, 2010, 3:07am UTC](https://boards.straightdope.com/t/us-budget-deficit/527316/35 "2010-02-03T03:07:25Z")
> [@Robot\_Arm](#): > > The U.S. raised taxes in the early 90’s and very soon we were awash in surplus. Temporarily, yes, but see my next point. > > In this case, the lag time was 8 years. I believe this had more to do with the change in administrations than with some automatic property of expenses to outpace revenue. > > But I’m really not sure we disagree all that much. I don’t think we do, on the points raised. However, I still believe that simply raising taxes will not fix the deficit in the long run, as history has shown repeatedly around the world. The countries which have gotten their fiscal houses in order have generally done so through spending cuts. > [@](#): > > I don’t think the Republican congress during the Clinton administration deserves as much credit as you seem to give it. The graph shows spending starting to come down in '91, and Republicans didn’t gain the majority in Congress until 1995. Have a look at [this graph](http://foldedspace.org/GRS/taxes_discretionarybreakdown.jpg), which breaks government spending down into domestic, military, and mandatory. You can see exactly what happened in the first years of the Clinton administration - domestic spending rose a little bit, but military spending collapsed. That was the ‘peace dividend’. Domestic spending started to be reduced after the Republicans took control of Congress. But really, we’re almost picking nits, because the devil is in the big blue line at the top - entitlements. They’re exploding out of control, and they’re about to get much worse. And frankly, both parties are to blame for this - we’ve known for decades that entitlement spending has to be controlled or the government will be in a world of hurt. And yet what does George Bush do? Create a new prescription drug entitlement. Democrats and Republicans have always pandered to old people, because they have a ton of political clout. And there’s about to be a lot more old people. This is the biggest problem facing the world - not global warming, not terrorism. The big problem is the demographic collapse in the developed world, leading to aging populations, exploding entitlements, a reduction in the number of working age people supporting retirees, and the requirement for destabilizing levels of immigration to prevent a complete demographic meltdown. The U.S. is in better shape than Europe, despite the entitlement crisis. Europe’s very nature is about to change over the next 50 years, due to the demographic collapse of indigenous populations and the overly generous social programs and retirement benefits they give the citizenry. Japan is a disaster waiting to happen. Because it has relatively little immigration, it is on the verge of a population crash the likes of which we haven’t seen in the modern world. But getting back to government spending, the obvious solution is to cut mandatory spending. That means raising the retirement age and means-testing social security. It also means some type of Medicare reform. If these things aren’t done, the amount of taxes that would have to be levied on the young to pay for the retirement of the old will be massive. ---
**Author:** ![spifflog](https://avatars.discourse-cdn.com/v4/letter/s/c5a1d2/32.png) [@spifflog](https://boards.straightdope.com/u/spifflog)\ **Post date:** [February 3, 2010, 3:18am UTC](https://boards.straightdope.com/t/us-budget-deficit/527316/36 "2010-02-03T03:18:06Z")
The cause of this problem is the American People. We have our hands in the till to the tune of $40,000 for every man, woman and child, and we don’t seem to care. And Duckster and company, this is truly a total problem, not a republican or democrat one. Both parties, when they were in power, cranked up the money machine. Both of them. ---
**Author:** ![DanBlather](https://avatars.discourse-cdn.com/v4/letter/d/f4b2a3/32.png) [@DanBlather](https://boards.straightdope.com/u/DanBlather)\ **Post date:** [February 3, 2010, 5:09am UTC](https://boards.straightdope.com/t/us-budget-deficit/527316/37 "2010-02-03T05:09:48Z")
> [@Sam\_Stone](#): > > There is an exception: Canada. We got our budget under control. We’ve been running surpluses for quite a long time, until the latest recession hit. So, did we solve our problem with major tax increases? Nope. We held the size of government to just slightly below the level of GDP growth, and slowly shrank it. According to [this](http://anepigone.blogspot.com/2008/03/government-spending-as-percentage-of.html)site in 2007 Canada’s govt expenditures were 48% of GDP. By comparison, in the US Federal spending is \< 20% of GDP. Of course the US does spend more as a percent of GDP than the economic powerhouses of Cameroon, Armenia, the Philippines, Brazil, Haiti, Cambodia, and Bangladesh. ---
**Author:** ![SenorBeef](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/senorbeef/32/2220_2.png) [@SenorBeef](https://boards.straightdope.com/u/SenorBeef)\ **Post date:** [February 3, 2010, 5:20am UTC](https://boards.straightdope.com/t/us-budget-deficit/527316/38 "2010-02-03T05:20:49Z")
Are you comparing total spending to federal only? ---
**Author:** ![DanBlather](https://avatars.discourse-cdn.com/v4/letter/d/f4b2a3/32.png) [@DanBlather](https://boards.straightdope.com/u/DanBlather)\ **Post date:** [February 3, 2010, 5:40am UTC](https://boards.straightdope.com/t/us-budget-deficit/527316/39 "2010-02-03T05:40:37Z")
> [@SenorBeef](#): > > Are you comparing total spending to federal only? The site compares federal spending to GDP. The federal budget deficit is what we are discussing. ---
**Author:** ![Kimstu](https://avatars.discourse-cdn.com/v4/letter/k/ecd19e/32.png) [@Kimstu](https://boards.straightdope.com/u/Kimstu)\ **Post date:** [February 3, 2010, 6:26am UTC](https://boards.straightdope.com/t/us-budget-deficit/527316/40 "2010-02-03T06:26:53Z")
> [@Sam Stone](#): > > Europe’s very nature is about to change over the next 50 years, due to the demographic collapse of indigenous populations and the overly generous social programs and retirement benefits they give the citizenry. Cite? There are certainly some changes occurring in European society and some adjustments that European economies will have to make (and in many cases have already made) to deal with them, but I’d like to see some hard evidence to substantiate the level of panic you’re trying to peddle. > [@Robot Arm](#): > > I don’t think the Republican congress during the Clinton administration deserves as much credit as you seem to give it. It doesn’t. Here’s an [analysis](http://www.cato.org/pub_display.php?pub_id=8137) of the fiscal policy of the Clinton years, from one of the libertarian gurus at **Sam Stone** ’s favored Cato Institute, no less: > [@](#): > > Bring Back Clinton > > […] Yet on Bush’s watch, and with his signature, the burden of federal spending rose to 20.3 percent of GDP in 2006, up from just 18.5 percent when he took office. > > During the Clinton years, by contrast, federal spending fell as a share of GDP, from 21.4 percent in 1993 to 18.5 percent in 2001. > > White House apologists argue that these spending numbers are skewed, since Clinton benefited from the “peace dividend” and Bush had to rebuild the defense budget to fight terrorism. They also explain that Bush reduced tax rates, offsetting the economic damage caused by excessive government spending, whereas Clinton presided over a big tax increase. > > These certainly are mitigating factors, but even when defense spending is excluded, Clinton reduced the burden of government, while Bush has expanded it. > [@Sam Stone](#): > > And frankly, both parties are to blame for this Not equally, though. Republicans and their apologists try to paint the budget crunch as a bipartisan problem, but the fact remains that since at least the 1980’s, Republicans have been much more reckless about deficits than Democrats have. They’ve also been more aggressive in pursuing nnately expensive activities such as risky deregulation and war. And so they finished up in 2008 dumping a big load of economic morning-after on the Oval Office desk for Obama to deal with. Frankly, while I as a Democrat am quite willing to admit the fact that Democrats have in many cases been fiscally irresponsible, it’s purest hypocrisy these days for any Republican (or anything that oinks like a Republican) to make that accusation. Let’s see Republicans and their apologists showing some real contrition first for the catastrophes that they were primarily responsible for, and then we can talk about how both parties need to work together to recover from them. > [@Sam Stone](#): > > This is the biggest problem facing the world - not global warming, not terrorism. The big problem is the demographic collapse in the developed world Again, I’d like to see a cite specifically substantiating the level of hysteria you’re advocating here. While the developed world definitely has some demographic issues to deal with, the shrillness and cloudiness of your doom-laden predictions does not inspire confidence in your assessment of the threat level. Your MO in these discussions, **Sam** , is to combine a superficially grave and sober tone with large vague claims of terrible danger, intended to scare people into thinking that your assessment and your proposed solutions must be reasonable. You gave us quite an impressive spiel along those lines when you were stumping for the Iraq invasion on the grounds that we couldn’t afford to risk the threat from Saddam Hussein’s WMD. I don’t think you can wonder that the credibility of your courageous-Churchillian-realism-in-the-face-of-looming-disaster shtick is a little bit impaired at this point. [Previous page](https://boards.straightdope.com/t/us-budget-deficit/527316.md?page=1) [Next page](https://boards.straightdope.com/t/us-budget-deficit/527316.md?page=3)