Investor's Business Daily cuts through the spin and gives a fresh perspective on the federal government's biggest problem: Spending money it doesn't have.
From an article by IBD's John Merline:
And the Bush tax cuts aren't to blame for the massive fiscal hole that opened up over the past three years. That was partly due to the unavoidable recession-caused drop in revenues. But the big driver was the massive increase in federal spending, which reached an astonishing 25% of GDP between 2009 and 2011.Read the full analysis at the newspaper's website:
In fact, according to IBD's analysis, even if Clinton-era tax rates had remained in effect during the recession — an unrealistic assumption — the country still would have added more than $1.5 trillion in debt because of all that extra spending.
And even with Clinton-era rates in effect over the next decade (higher than even Obama proposes), the U.S. would still be more than $6 trillion deeper in debt, based on current spending projections.
Budget forecasts also make it clear that the debt monster cannot be slayed without taking on so-called entitlement programs like Social Security, Medicare and Medicaid. All the spending growth relative to GDP over the next decade comes from entitlements, and by 2030 those three programs will eat up more than 17% of the economy.
But Obama's debt plan leaves the programs largely untouched. And while the plan by Rep. Paul Ryan, R-Wis., tackles Medicare and Medicaid spending, it doesn't address Social Security.
Soaring Spending Spurs Deficits - Investors.com