Taxes and the Deficit

Just like managing your fiscal home the Government has to do manage its finances balancing inflows “taxes” with spending. The difference between the government and us is the caveat the Government can spend what they do not have by borrowing and increasing the debt ceiling.

Somehow my son thinks the ATM is like the Government, a source of unlimited revenue, perhaps he is studying finance in classes taught by one of the former Presidents.

The government has recorded budget surpluses in only five years since 1969, most of them under Democratic President Bill Clinton.

Early in his Presidency, Mr. Bush made a statement concerning the surplus that “it is your money” and issued tax cuts that significantly increased the debt with out any real economic growth, and the deficit grew during his term as President.

Then under President Trump, in 2019 the debt ceiling was suspended until 2021 while the Trump Administration gifted to the wealthiest a tax cut of unconscionable negative economic consequences. The result was to increase our debt from$19.9 Trillion, when Mr. Trump became President to over $27 Trillion in four short years. Where were the “deficit hawk” Republicans during this time?

Added to the revenue short fall: Covid, CARES stimulus payments, TARP, and other funding necessities which required massive spending with no revenue, we are where we are.

The word Tax cut appears to be an oxymoron, to most middle-class Americans.  Since Ronald Reagan and with all the tax cuts over the years, most middle-class American’s feel no real tax relief.

Now comes along the fiscal responsible, House Speaker Mr. McCarthy with his spending cut scalpel. Perhaps his scalpel was no more than a dull pen knife under Ex-President Trump.

While spending needs to be brought under control perhaps we might also consider rolling back the tax cuts to what they were under Former President Clinton.