I feel like I’ve been saying this a lot, but this is an important concept that absolutely must be said and repeated as nauseum, until the average person gets it.
Our deficit is NOT high because the government is spending too much money.
Let me repeat that, and then YOU be sure to repeat it far and wide to anyone and everyone you meet, because it’s important:
The reason we have a record-high deficit is NOT because the government is spending too much money.
Now, let me explain. First, I want to state, for the record, that the government does waste money. The above statement is not an acknowledgement that every dollar the government spends is good and just and goes to the right places. In fact, one solution to the deficit problem would be to take the money we spend on one thing, and move it to something else. I'll talk more about that in a future post.
But the FACT is, the government really isn’t spending all that much more, adjusted for inflation, than it did in 2001, when George W Bush and the Neocon Republican Party were handed a $400 billion surplus; certainly they're not spending $2 trillion more, which is how much higher the deficit is than it was in 2001. Even when you take into account the unnecessary war spending, you can’t account for the deficit; not even close. The fact of the matter is, government spending isn't the problem; it’s a lack of revenue. The increase in the deficit isn’t because we spend too much; it’s because we don’t have enough money coming in, because there just aren’t enough taxpayers. Are tax rates too low? Not necessarily. Creating more taxpayers would reduce the need for higher tax rates.
And please stop blaming Social Security and Medicare. Both of those programs are paid for, and don’t add one red cent to the deficit. Social Security alone has a paper surplus that keeps it completely solvent for another 35 years, absent any changes to the law. Yes, it’s true; we can’t possibly cut spending enough to eliminate the deficit without gutting entitlement programs. But the fact of the matter is, most entitlement programs are more than paid for by the taxes earmarked to pay for them. All gutting Social Security would do would be to allow them to take more Social Security money, apply it to the general fund, and pretend the deficit went down. That’s a key word in right wing circles; “pretend.” They pretend a lot. They pretended that their approach to economy was the greatest ever, and look what happened. Trusting the current breed of Republican with your money is not a smart idea.
To be fair, and not be stupid, we have to take Social Security and Medicare off the table. The deficit is more of a danger to them than they are a danger to the budget.
You can never cut enough from government spending to reduce a $1.5 trillion deficit; it just can’t be done. In fact, by cutting most spending, Republicans are actually making a bad situation worse. By cutting government spending, you actually reduce the amount of money in the economy, which actually has a depressing effect on jobs. A depressing effect on jobs means more unemployed and fewer taxpayers, which will result in a higher deficit, not a lower one.
What do people think happens to the money the government spends? Even when it’s given to Halliburton and Blackwater, it goes into the economy, employs people and creates taxpayers. Even the money that goes to the inner city poor eventually finds its way to local bodegas and Wal-Mart. Food stamps go to grocery stores, who put more goods on their shelves to replace those sold. Food stamps also support the farmers who grow the food purchased with those food stamps.
Apparently, Republicans would like you to believe that the government is loading up rockets with dollar bills and shooting them off into space. But every dollar the government spends goes into the economy and circulates. Every single dollar, including those from that bloaed defense budget, actually goes into someone's bank account and subsequently to the bank to pay the mortgage, to the supermarket to pay for food, and to utilities to pay for energy use.
Make no mistake; Republicans know this. Lest you think Republicans are just dumb, let me remind you that the overall neocon goal while running the country is to starve the beast. Their intent is to bankrupt this country, and put their own in charge forever. It's their brain-dead supporters who are too dumb to understand what their own party is doing to them.
The fact of the matter is, the government’s job in circumstances like these should be to spend MORE money, not less. The debt will eventually have to be paid, but until you create more taxpayers, the deficit will continue to increase, because it’s a LACK OF REVENUE that is causing the current deficit, and NOT spending. Think about it; if your family doesn’t have enough money to pay its bills, you can cut extravances, like cable tv and Internet, and you can stop buying Starbucks. You can also wear a sweater and put the heat down to 60, or leave the windows open and sweat all summer.
Or you can just go out and get a second job. That’s what most people do. Republicans, however, think we should all live in a cave down by the river, kill our own food and wash our self-made clothing on rocks. Apparently, they’re too lazy for that second job. Seriously, if your boss comes to you and tells you he's cutting your pay 15%, tell me you're not writing up your resume that night. You don't cut your expenses 15%; you look for more revenue.
We need to invest in creating more jobs. Cutting spending results in fewer jobs. Also, cutting taxes on the rich, cutting taxes on corporations and reducing wages and benefits for workers do nothing to create more jobs. The way to create more jobs is to raise taxes on the rich and corporations, and then offer them reductions for every job they create. You want to see jobs? Watch how fast the rich hire people when they’re faced with a 70% rate if they don’t provide jobs, or a 25% rate if they do.
And don’t to take my word for it, just look around. In 30 years, employment has largely stagnated, as taxes on the rich dove. The lower tax rates have gone, the more American companies hired people overseas. During the most prosperous period in our history – indeed, the largest economic boom in world history – our top tax rate stood at between 70-91%. Now, the top tax rates are at 34-35% and the economy is stagnant. If you think that's coincidence, you must be Republican. Why can’t we seem to learn from this, and go back to doing what we did before?
It’s this simple, folks. To reduce the deficit and pay down the debt, we need more revenue. If no one wants to pay higher taxes, then we need a lot more taxpayers. One way to do that would be to get all of those people here illegally on the books and paying taxes. Can you say "amnesty"? Face it; 12 million more taxpayers would go an awful long way to reducing the deficit, wouldn't you say?
We cannot cut spending enough to even put a serious dent in the deficit, and we shouldn’t worry about it anyway. The national debt doesn’t cause unemployment, and it doesn’t cause businesses to suffer. Massive spending cuts do that.
So, go tell the truth and change the argument. Government spending is NOT the problem. The problem is, not enough taxes, and not enough taxpayers.
