Deficits Are A Symptom Of The Real Problem: Spending
Milt Friedman once said that our nation would be better off with big deficits but a smaller overall budget than with a big budget with smaller deficits. His point being that it’s the size of the government that’s the problem, because more government means more burden on the economy.
Dan Mitchell from the Cato Institute makes this same point, saying that while deficits aren’t a good thing the fact that our government spending (and thus the size of our government) is growing so quickly is much worse. In short, deficits are the symptom.
Spending’s the sickness.
This same argument applies when some claim that Bush-era tax cuts resulted in deficits. That’s not actually true. After Bush cut taxes federal tax receipts actually went up. Now, we can argue about whether or not the Bush tax cuts were entirely or even partially responsible for that growth in tax revenues, but the simple truth is that it was spending growing even faster than tax revenues that caused the deficits.
Without that growth in spending we might have erased the deficits and actually paid down a bit on our national debt. Tags: Asshats, Domestic Issues, Politics
