IT RISES EVERY YEAR - It's the Spending, Stupid: A Historical Look at Federal Government Spending
There are few constants in the universe: gravity, the sunrise, the oceans, the moon. Add another: spending by the federal government; it rises every year.
We have failed to heed the lessons of economic history, with terrible consequences for our economy and country. And the most crucial of those lessons, particularly since the start of LBJ’s Great Society, is this: deficits have been caused not by a lack of income-tax increases but by recession and, most of all, by excessive government spending.
Because I comment on this topic so frequently, especially in the context of Reaganomics, I constantly deal with these issues from a historical perspective. Here, I would like to make it easy for everyone to see the numbers themselves and understand the root of the problem.
The answers are as easy as googling the words “historical tables deficit.” Two sources pop up: CBO historical tables and OMB historical tables. “CBO” is Congressional Budget Office; “OMB” is Office of Management and Budget. These are the official go-to sources for data on deficits, revenues, and government expenditures.
Either source will work. To keep it simple, I’ll focus on the OMB numbers. At the OMB link is Table 1.1, titled, “Summary of Receipts, Outlays, and Surpluses or Deficits: 1789-2016.” That is an official scorecard of spending by the federal government since the founding of the republic.
Looking closely at the chart is an eye-opening experience. As the first two columns show, receipts (i.e., revenues) and outlays (i.e., expenditures) moved up and down throughout our history. In 1965, however, something historically unusual, something literally deviant, began: Spending increased every single year, non-stop, consistently, without exception, into the Obama presidency, from 1965-2009.
There are few constants in the universe: gravity, the sunrise, the oceans, the moon. Add another: spending by the federal government; it rises every year.
Significantly, revenues don’t increase every year. The most dependable reason for declines in revenues is not a lack of tax increases, or high enough income-tax rates, but recessions. Since 1965, as the data shows, annual revenues declined seven separate times.
At the start of the Great Society, in 1965, revenues and expenditures were nearly equal, with expenditures only slightly higher, leaving a manageable deficit of $1.4 billion. By 2009, however, annual expenditures ($3.5 trillion) had far outpaced annual revenues ($2.1 trillion), leaving a record deficit of $1.4 trillion.
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"Stop Spending, Stop Spending!" - Santelli Loses It, Calls Liesman A Communist
CNBC Video - Rick Santelli, Steve Liesman, Joe Kernen - June 28, 2010
Santelli annihlates fiat spending, and it's messenger Steven Liesman.
Watch the entire clip if you have time, though the mayhem doesn't really get going until after the 7-minute mark. Santelli and Liesman both come close to losing it. These quotes don't do justice to the emotion.
- "Go read some Austrian economist instead of the funny pages."
- "I am ready to talk about Fred Hayek, John Hayek, and Selma Hayek."
- "Go back to Russia where you understand the state and the citizen."
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Aug 31, 2011 at 12:23 AM
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