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.