It’s kind of silly to look at things in real dollars, when GDP today is well over 10 times what it was during WWII.
Tax revenues, as a share of GDP, were at 18.5% last year, higher than they were in 2000, before the Bush tax cuts!
You can try to raise tax rates to 50%, but you’re just going to stunt GDP growth (taxing a bigger piece of a smaller pie) and encourage more noncompliance. We’ve had top tax rates of 35-90% since WWII, and rarely has the federal treasury collected over 20% of GDP. In fact, the 18.5% last year is above the historical average.
Someone has to cut spending. But Congress is as much at fault for that as the President is.
The $2 trillion in debt pales in comparison to future SS/Medicare liabilities that are going to hit when the boomers retire. The only way to manage to pay for all this is to enlarge the pie, and that means promoting pro-growth policy even with some short term cost.
Tax revenues in 2000 were 20.9% of GDP. Tax revenues for the 5 years 1997-2001 averaged 20.0% of GDP.
The $2 trillion in debt pales in comparison to future SS/Medicare liabilities that are going to hit when the boomers retire. The only way to manage to pay for all this is to enlarge the pie, and that means promoting pro-growth policy even with some short term cost.
This doesn't make sense. All of the financial irresponsibility that has gone on the past 6 years isn't a short term cost that will pay off in the future, it's a short term benefit borrowed against the future. We have huge entitlement costs just around the corner, and the response was promising even more entitlements and taking huge loans to play nation builder in Iraq and build bridges to nowhere.
They are going to raise the top rates to 50% to pay for this crap, and it's going to work just as well here as it did in Europe.