Senator John Thune
If you listen to Washington Democrats these days, you’d think that America’s economic and fiscal woes could all be solved if we would simply raise taxes. Evidently the tax increases last month served only as an appetizer for the big-government crowd. Now the spenders are back for the main course. It will never be enough. As my dad used to say about the instinctive reactions of members of the animal kingdom, “it’s the nature of the beast.”
While I knew that President Obama and his allies in the pursuit of government nirvana would not accept a mere $620 billion in higher taxes at the start of the year, I did not believe they would so casually dismiss the pure arithmetic of the federal budget. Needless to say, I was wrong.
This past week, the top Democrat in the House of Representatives, Nancy Pelosi, repeated what has become doctrine on the left: the idea that we don’t have a spending problem. “It is almost a false argument,” Pelosi said, “to say we have a spending problem.” This outrageous claim prompted the White House press secretary to admit that Washington does have spending issues, but it’s been reported that the president himself has said that we don’t have a spending problem.
And just Thursday, a senior Senate Democrat, Tom Harkin, stated, “I want to disagree with those who say we have a spending problem.”
Let’s check the math. Between 2007 and 2012, annual federal spending went up from $2.7 trillion to $3.5 trillion, an increase of nearly 30 percent. Inflation over that period was 10.8 percent, meaning government grew at almost three times the rate of inflation. Federal spending as a percentage of GDP increased from the 40-year average of about 20 percent to more than 24 percent. And that’s before you factor in the president’s new health care law.
Meanwhile, the tax revenue coming into the Treasury is increasing. According to the Congressional Budget Office, revenues will increase by roughly 25 percent between 2013 and 2015. Revenues as a percentage of GDP will hit 19.1 percent in 2015 and will average 18.9 percent of GDP over the next decade, a full percentage point above the 40-year historical average of 17.9 percent. Revenues increased by 6 percent in 2012 and will increase by 11 percent in 2013, according to the CBO. Simply put, tax revenues are increasing, and as a percentage of GDP, will exceed the 40-year average over the next decade without any of the Democrats’ proposed tax increases. Yet Washington has been running trillion-dollar deficits the last four years and the national debt will balloon from $16.5 trillion today to $26 trillion ten years from now.
Could it be that Washington’s fiscal problem isn’t that it taxes too little, but that it spends too much?
To the disciples of liberal deficit mythology, the math is hard to accept, which is why they try so hard to repeat their mantra that we don’t have a spending problem.
Unfortunately for them, the American people can add, and when they do the math, Washington Democrats will be exposed as the fiscal charlatans they are, at which point they will fall back on their original talking point: “This is Bush’s fault.” Even that will sound more and more delusional in the face of trillion-dollar deficits.
When Democrats are prepared to confront reality, Republicans stand ready to work with the president and congressional Democrats on spending reforms that will improve our fiscal future, grow our economy, and create jobs. Until then, arithmetic will make our spending problem ever more undeniable, even as the deniers deny it.Sen. John Thune, (R-S.D.) is Chairman of the Senate Republican Conference.