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The Congresssional Budget Office projects the 2011 federal deficit will be $1.5 trillion. Funny how this came out the day AFTER the State Of The Union address. Purely coincidental, I'm sure.
The Washington Post knows where to place the blame:
The still-fragile economy and fresh tax cuts approved by Congress last month will drive the federal deficit to nearly $1.5 trillion this year, the biggest budget gap in U.S. history, congressional budget analysts said Wednesday.
The economy has certainly played a part in reducing revenue to the government (by about $400 billion per year), but the only "fresh tax cut" Congress enacted last month was President Obama's temporary payroll tax holiday, estimated at $112 billion. All the other "fresh tax cuts" the Post is referring to weren't tax cuts at all, they were simply extensions of current tax rates that have been in place for years. There was also a tax increase in the recent tax deal. The estate tax will go from 0% to 35%.
But what infuriates me about our media is this - they almost never identify the REAL source of our trillion+ dollar deficits. The real source of our record deficits is - government spending. It's so obvious that it takes an entire liberal media to obfuscate the fact.
Allow me to explain as simply as I can.
In FY2007, the federal government spent $2.729 trillion. We had a deficit of $160 billion that year. This was after the Bush tax cuts had been in place for years and we were fighting two wars.
In FY2010, the federal government spent $3.456 trillion (down from Obama's requested FY2010 budget of $3.720 trillion). The deficit was $1.29 trillion.
What this reveals is - as federal spending increased by $730 billion per year between 2007 and 2010 (during a non-inflationary time), the deficit increased by roughly $1.1 trillion per year during the same time period. Spending increases, not tax cuts, accounted for the overwhelming majority of the deficit (over 70% of it). The rest ($400 billion) was due to falling recession revenues. I suppose we could have enacted massive tax hikes during the Great Recession to cover the difference, but that would have done much harm to the American people and the economic recovery effort, as most everyone except economically-challenged left-wingers agrees.
Thanks to the historic failure of the outgoing Democrat-led Congress to do it's job and pass a budget for FY2011, we don't have a budget. We're operating on a series of short term spending authorizations. President Obama did release a FY2011 Budget Request back in February 2010, but he has spent a lot more money since that time, so why bother even mentioning it ? What we know is that we face a $1.5 trillion deficit this year.
Keep that $1.5 trillion deficit figure in mind as you listen to this from the previously linked Washington Post article:
Lawmakers scrambled Wednesday to respond to the darkening budget picture, with Republicans pressing their call for sharp and immediate cuts in domestic spending. Twenty-one Senate Republicans, meanwhile, unveiled a plan to amend the U.S. Constitution to require balanced budgets, a top priority of the tea party movement.
Democrats resisted both initiatives, arguing that amending the Constitution, a lengthy process that requires a vote in all 50 state legislatures, would do little to address the current problem. They dismissed as "drastic" a proposal by House Republicans to slash $100 billion from the current budget, arguing that cuts of that magnitude would endanger a million jobs on public- and private-sector payrolls at a time when the unemployment rate already stands at 9.4 percent.
Un-freaking-believable. Democrats think a $100 billion cut in spending, following the aforementioned $730 billion annual increase in spending over the last few years, is "drastic". This is after federal spending literally DOUBLED over the last decade, going from $1.789 trillion in 2000 to twice that much now. That spending explosion is why we have trillion dollar deficits. That's why we have a $14 trillion national debt. There is NO OTHER REASON, and it's about time we face up to it, even if Democrats would rather not.
According to a recent Gallup poll, even the majority of Americans don't want to face the truth. They are against most spending cuts:
Americans don't want many spending cuts, but if you ask Americans if they want their taxes raised, they also say no, they don't want that either. Americans want government services, they just don't want to pay for them.
I call this Adventures In Denial. It can't last much longer. We're going broke because of it.