The federal government is addicted to spending. The vast amounts it outlays is less about making the nation better than it is about getting politicians re-elected.
The Tax Foundation reported in late 2022 that “federal tax collections are up 21 percent over the last year, according to the latest data from the Congressional Budget Office (CBO). Federal tax collections hit a record high of $4.9 trillion in nominal dollars for the fiscal year (FY) 2022 that ended September 30, which is $850 billion more than last year’s $4.05 trillion in collections (also a record). As a share of GDP, federal tax collections are at a multi-decade high of about 19.6 percent in FY 2022, up from 17.9 percent last fiscal year and approaching the last peak of 20 percent set during the dot-com bubble in FY 2000. There are only two other years in U.S. history when federal tax collections exceeded this year’s level, both during World War II: in 1943, federal tax collections reached 20.5 percent of GDP before falling to 19.9 percent in 1944. Compared to average federal tax collections in the post-war era of 17.2 percent of GDP, this year’s collections are set to exceed that level by 2.4 percentage points.”
Despite that, in FY 2022 there was a deficit of $1.38 trillion. Washington’s debt now stands at over $31 trillion, and, having reached a borrowing capacity of over $38 trillion, the White House is demanding an increase in that astronomical debt limit be raised without any considerations of cuts in future spending. That debt limit has been raised about eighty times since 1960. Despite the dire burden placed on taxpayers, President Biden is seeking even greater spending to be paid for by even higher taxes, and wants to hire more IRS agents to insure collections. Despite claims to the contrary, those agents will not be targeting the wealthy, who have attorneys and accountants on staff to defend them. They will be targeting small business owners, free-lance workers in the “gig” economy, and folks like waiters and waitresses whose income comes from tips. The Washington Times noted recently that “citizens reporting anywhere from no taxable income to $200,000 a year will experience the full force of the new IRS agents — a little less than a million more audits per year — compared with about 250,000 a year projected to be conducted on those making more than $200,000.”
The General Accounting Office has long warned that Washington’s spending addiction is a path to disaster, noting that “Growing debt is not just a number—it represents a threat to our economy and our ability to meet national needs and priorities…Rising federal debt could constrain Congress’ ability to support the economy or address other national priorities, reduce private investment & overall economic growth, erode confidence in the U.S. dollar.”
Much of that spending is not geared towards meeting real national needs. One example: Biden’s unconstitutional proposal to spend taxpayer dollars to forgive students loans was a bid to get support in the 2022 elections. Liz Wheeler, writing for Newsweek, called it a “desperate attempt to buy votes.”
A substantial portion of the $1.2 trillion dollar “infrastructure” package went to needs other than roads and bridges, transit and rail. The CATO Institute notes that rather than make decisive improvements, Biden seeks to “remake the nation’s infrastructure on the basis of his beliefs about labor unions and the environment,” essentially playing to his political base.
Don’t blame defense spending for the deficit. As war clouds undeniably gather, only about 13% of federal spending goes to the Pentagon. That’s actually less than what it was in many years over the past half century.
The sums extracted from taxpayers to Washington’s treasury should not be used as personal piggybanks for politicians. Neither the citizenry nor the nation can survive this massive descent into bankruptcy.
Illustration: Pixabay