Yes, the issue is spending
By Scott Tibbs, November 9, 2021
to my letter to the editor
argues that I was missing "nuance" about "why" revenue and spending increased over time. I get 200 words in a letter to the editor, not nearly enough space to get into every detail of budgetary policy. I did not say that federal revenue grew only because of tax cuts. The letter invents an argument I did not make, and that claim should have been edited out.
But the "why" spending and revenue went up simply does not matter: Despite the fact that revenue was growing in the 1980's and 2000's, spending increased at a much higher pace than revenue did. Revenue was significantly higher when President Ronald Reagan and President George W. Bush left office than when they entered office, yet both were running large deficits. The main point of my letter - that the deficits were caused by too much spending instead of too little revenue - remains true.
Under Ronald Reagan:
- Total federal revenue in 1981 was $599 billion
- Total federal spending in 1981 was $678 billion
- Total federal revenue in 1988 was $909 billion
Under George W. Bush:
- Total federal spending in 1988 was $1.064 trillion
- Total federal revenue in 2001 was $1.991 trillion
- Total federal spending in 2001 was $1.863 trillion
- Total federal revenue in 2008 was $2.524 trillion
- Total federal spending in 2008 was $2.983 trillion
The author brings up the Clinton-era surpluses. But note that when we started running a surplus was after the Republicans took control of Congress in 1995 and moved to put some discipline on our spending - not even by cutting spending, but reducing the rate of growth. Would we have had budget surpluses without the Republican Congress? The CATO Institute
In fact, in 1995, two years after that tax hike, the budget baseline submitted by the president’s own Office of Management and Budget and the nonpartisan Congressional Budget Office predicted $200 billion deficits for as far as the eye could see.
The author admits
that significant increases in federal spending caused the Bush deficits with the amount of money we spent on the war in Iraq. It is said that during wartime, we need to choose between guns and butter. However, Bush refused to make that choice. He decided we could have both, which gave us huge budget deficits. I am not sure what author was responding to with his statement that President and Bush and a Republican Congress "killed the surplus," considering I explicitly called out Republicans generally and Donald Trump by name for lack of fiscal discipline.
The only way we are going to get the federal budget deficit under control is to get spending under control. Raising taxes on "billionaires" will not solve the problem. We do not need deep spending cuts or harsh austerity measures to get back to a balanced budget, but we do need to abandon aggressive multi-trillion dollar spending schemes. We simply need to hold the line.
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