Evan Thomas expresses in his latest Newsweek piece the concern that President Obama has not yet decided to tell the truth about unpopular policies that would fix our federal government?s budget mess.
Thomas? solution, of course, involves tax hikes, though he admits that raising taxes ?dramatically? would ?truly stifle economic growth.? He calls for a mix of tax hikes and cuts.
But here?s the most interesting statement to this reader:
When the debt is piled too high, when the economy threatens to sink under the weight of accumulated obligations that have been put off too long? There are more than a few signs that those times are not so far away for the federal government, and that in some big (and big-spending) states, the day of reckoning is now.
President Obama’s new federal budget proposal projects, with unusual clarity, that the trillion-dollar-plus federal deficits piling up during the current recession are not just a temporary condition necessitated by hard times, soon to be cured by a return to prosperity. Rather, the red ink threatens to drown us. For many years, federal spending remained about 20 percent of the overall economy. But under Obama it’s now a quarter of the economy. The national debt has grown to more than 50 percent of GDP, and according to the nonpartisan Congressional Budget Office, it could plausibly approach 100 percent of GDP by 2020?a figure not reached since World War II. Unless something drastic happens?like significant tax increases and cuts in those sacred entitlement programs?the cost of the government will continue to outrun revenue by staggering margins.
Why do we find ourselves in such a predicament, you might ask? Government spent ? and continues to spend ? too much. Fix that problem, and you?ll be much closer to a long-term solution.
