Deficit - - is it a tax problem or a spending problem?

Question

Yes, there's a very clear-cut right answer.

http://www.heritage.org/research/features/BudgetChartBook/fed-rev-spend-2008-boc-C1-Federal-Spending-Is-Growing.html?CFID=24898425&CFTOKEN=72333719

Answer 1

At this point it's a borrowing problem.  You really can't have a war of any duration without borrowing money.  In WW2 people bought war bonds and if you couldn't afford an entire bond you could buy a 'war stamp'  Taxes were raised, but nobody cared.  People who complained were sneered at..."Doncha' know there's a war on?"  The Bush Junta decided that asking the American public to do anything but put a magnetic Made-in-China yellow ribbon on their gas devouring SUV was too much.  No war tax, no rationing, no draft and no news from the front!  Instead these creeps cut taxes for the rich and for the corporations and went out into the world and hocked off bits and pieces of our country to raise the money to fight two wars with no natural stopping place.  These bums mortgaged the future of our country and this mortgage is going to rip into the flesh and bone of every wage-earning American for a generation or more.  It wasn't even hard for them to do this to us...they waved a flag and shook a cross and like magic huge numbers of people became willing co-conspirators.  We'll pay for this..we're paying for it now and if the American public is so foolish as to elect old man McCain and the same weasels as now have their claws into the public's business the bill will probably turn out to be unpayable.  Then what?

Answer 2

Surplus during Clinton, shot to h**l by Bush.

Answer 3

It's both. As the article says spending is growing faster than revenue.  But part of the problem is tax cuts to the rich--and the failure of the Bush administration to enforce tax laws and oversight. For example, the IRS estimates there is around $100 BILLION in lost revenue because corporate exectuatives and other such are being allowed to siphon their profits off and put them in offshore banks.

Spending is also out of control--that's obvious. Between a pointless war in Iraq, massive no-bid contracts, etc.  the GOP is wasting an incredible amount of money. They are even giving Exxon over $1 billion in annual subsidies, for heaven's sake!

Answer 4

Clearly it is a spending problem.

Crabby has no idea of what he is talking about.  The dip in revenues you are seeing in the chart corresponds to the recession left by Clinton. Tax revenues have doubled under the tax cuts as the 'rich' are not trying to shelter their incomes from onerous taxes.  That is a reality - see the uptick in the graph?

Bush has greatly enlarged the size of gov't with Medicare Part D and the TSA.

Answer 5

Basically it is like your own finances, you owe more than you make so you keep borrowing to pay the bills. This is what the goverment is doing. Most responsible people spend only what they can afford to spend, they live with in their means

Answer 6

That is not an easy question as we are a free market economy with many things to consider.  The simple answer is It can be the result of either, but in most cases it is caused by both.

    You have thee possible causes of a deficit.  The government can increase spending to a point of  more money out then they receive in taxes.  The government can cut taxes but not programs they have allotted money for.  But the real wild card is they can increase or decrease the money supply in the system.  When they increase wealth in the economic system, it decreases the actual value of money.  Republicans like to do this instead of increasing taxes.  The result is essentially the same.  This is an important tool in deficit spending.