Saturday, December 12, 2009

Engorge the beast

The United States is fast approaching a debt burden equal to GDP which has not been seen since the days of the Great Depression and World War II.

Not that the press corps cares anymore, but the omnibus also continues the earmark explosion that Speaker Nancy Pelosi vowed to end when she was trying to oust Republicans in 2006. The Heritage Foundation counts 5,224 earmarks, bringing the total for the year to about 10,000, or about 23 for every Congressional district. There is money for bike paths, skate board parks, museums, water-taxis to resort towns, and other absolute necessities.
Not exactly Hoover Dam and the USS New Jersey.

Senator Kent Conrad, the ranking Democrat on the Budget Committee, is a walking example of the split Democratic spending personality. He frets that U.S. debt will soon be 114% of GDP, a level he says is "absolutely unsustainable" and a "threat to the economic security of America." Yet he keeps voting for every spending bill and will vote for the multitrillion health bill too.
After so much double talk, we've concluded this is all part of a conscious political strategy. Spend so much and run up the deficit to unprecedented levels, then turn around and claim that there's a fiscal crisis that can only be solved with higher taxes. They spend, you pay.
Emphasis on "you" because, no matter how much the Democrats swear the tax burden will only fall on the "rich," there's simply not enough in Bill Gates' bank account to cover all this spending. Washington is playing with the monopoly money of China's easy credit but, just like my post-Christmas credit card bill, we gotta pay in the end.

Kinda releated - Megan Mcardle: "A new breed of deadbeats"


The Sanity Inspector said...

We fought and lost the battle of eliminating the federal debt back in the Reagan years. Clinton scored some yearly surpluses, but only because the gov't was taxing us faster than they could spend it. (Think about that!) We're over the falls, and have been for a generation.

Bram said...

We were on track to run federal surpluses at the end of Reagon's Presidency. Bush Sr. screwed it up with the S&L bailout - then lost his presidency by signing a tax increase.

Ninz said...

Big picture, fellas. Between 1981 and 1988, the United States went from being the largest international creditor to the world's largest debtor nation. As of 1980, from Washington through Carter, America's combined debt amounted to 909 billion dollars, including all the money ever borrowed for both World Wars, the American Revolution, the Civil War, Korea, and Vietnam. In 8 years, Reagan added 1.7 trillion dollars to the total. The boulder's been rolling ever since.

Reaganomics revisionism is a lively hobby for some. But no one-year budget surplus on anybody's watch could have washed away the legacy of Reagan's fiscal policy.