Debt crisis – from history to the future
Watching the U.S. “debt crisis” unfold, I am reminded that to see the way forward, it is often good to look backward. History does not consist only of facts, but history is full of facts that cannot be ignored. In this case, it helps to see where the debt came from – this is essential to dealing with it. The New York Times provided such a summary in one simple picture on July 24.
(New York Times Editorial Graph)
We can see that going back to the tax rates prior to 2002 eliminates some 40% of the deficit that contributes to the debt. We have always borrowed to pay for wars, but not every penny. So, ending the current wars that are unpaid for eliminates much of the rest of the deficit. One could go further. The Institute for Policy Studies reported this spring that if the U.S. could return to the tax rates of 1961, after the Kennedy tax cut of that time, the resulting revenue would eliminate not just the annual deficit but the entire U.S. debt in about ten years. (This would take us back to the halcyon year of 2000 when the U.S. was running a surplus and the debt was set to disappear by 2014. Then came the tax cuts of the day, the wars, and the underfunded drug benefit program.)
I will simply remind everyone that the most prosperous period in U.S. history (1946-1979), when the great middle class was built and much of our legacy infrastructure was put in place, coincided with a period of higher taxes.
You get what you pay for, and it may just turn out that what you get for higher progressive tax rates is a thing we call a civilization. What you get when you refuse to pay taxes is something else, I am not sure what to call it, but probably not a civilization as we have known it.
4 Comments
I found this post quite intersting!
PauvrePapillon at 9:22 PM August 11, 2011
Instead of looking at tax rates, let’s look at the actual dollars received by the federal government (in billions).
Under Jimmy Carter…
1977… $355.6
1978… $399.6
1979… $463.3
1980… $517.1
Under Ronald Reagan…
1981… $599.3
1982… $617.8
1983… $600.6
1984… $666.4
1985… $734.0
1986… $769.2
1987… $854.3
1988… $909.2
Under George H. W. Bush…
1989… $991.1
1990… $1,032.0
1991… $1,055.0
1992… $1,091.2
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PauvrePapillon at 9:22 PM August 11, 2011
Under Bill Clinton…
1993… $1,154.3
1994… $1,258.6
1995… $1,351.8
1996… $1,453.1
1997… $1,579.2
1998… $1,721.7
1999… $1,827.5
2000… $2,025.2
Under George W. Bush…
2001… $1,991.1
2002… $1,853.1
2003… $1,782.3
2004… $1,880.1
2005… $2,153.6
2006… $2.406.9
2007… $2,568.0
2008… $2,524.0
Under Clueless Comrade Barry…
2009… $2,205.0
2010… $2,162.7
Where are the Tax Cuts?
Thanks Cathy. I do hope the Congress has the courage to go back to the tax rates of the Clinton years when the current law expires. It would help a lot.
As for Adam’s comment, I would disagree that the NYT is all leftist propaganda. Where the debt has come from is a simple matter of math, nothing to dispute there. Sorry.
It’s an unfortunate thng when taxes became synonymous with evil. In a civilized world, it makes sense for the individuals in the community to pull resources for the collective good. I wish we could revisit our ideas about taxes. For many ‘taxes’ are viewed as supporting the great unknown who are lazy and unwilling to work. People forget about all the good our taxes can do.
Anyway, I love your words of wisdom.
Citing facts and figures from the NYT does not provide ANY credibility to your post.
It is all leftist propaganda.