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TMFFlushDraw (64.50)

Our Spending AND Revenue Problem

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June 26, 2011 – Comments (0)

Dear tax payer,

I have provided a couple of noteworthy links to our ongoing discussions about deficits. The first one is historical data from the CBO relating to federal gov't revenues and spending. 

http://www.cbo.gov/ftpdocs/120xx/doc12039/HistoricalTables[1].pdf

Please note a few numbers in this link. 

- In 2000 gov't revenues were 20.6% of GDP and we had a 2.4% surplus

- By 2003 gov't revenues had fallen to 16.2% of GDP and we had a 3.4% deficit - BTW, this was supposed to spur economic growth. Did it?

- In 2009 and 2010 gov't revenues were a measley 14.9% of GDP

The second link is CBO estimates of future budgets. This document assumes no policy changes.

http://www.cbo.gov/ftpdocs/120xx/doc12039/BudgetTables.pdf

- Note that without changing policy deficits would fall to $533 billion in 2014 from $1.48 trillion in 2011. 

- Also note that most of that deficit reduction is in the form of higher revenues (expiring tax cuts). The increase would bring us to a level right around our historical average shown in the first link. aka. We've experienced taxes like this before. 

Bottom line: We have a spending AND revenue problem.  

Thoughts? 

Travis Hoium 

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