| This chart from the CBO shows federal revenues and spending since 1974. Some patterns are easy to detect. The dotted lines are the average revenue and spending as a percent of gross domestic product, so it’s easy to see where the bigger problem lies — and it’s not with revenue. Since 2001, even with a couple of tax cuts, revenue has remained remarkably consistent and at the historical average. There was a dip around the 2009 financial crisis, but otherwise steady. Outlays, however, have been rising and are now several percentage points higher than the historical average. Now, you would expect government spending to rise when there are crises to deal with, like the Great Recession or the Covid pandemic. But once those challenges have passed, spending never seems to come down. Instead, a new spending floor is created. The folks at the nonpartisan Citizens for a Responsible Federal Budget analyzed the deficits since 2001. Here is what they found: - “Rising spending relative to GDP explains about two-thirds of the growth in annual budget deficits since 2001, while declining revenue explains one-third.”
- “Had revenue remained stable as a share of the economy, the debt would be half its size; had primary spending been stable, it would be nearly paid off.”
So, the next time you hear some politicians claiming that all our fiscal problems are caused by Americans not sending enough of what they earn to Washington, don’t believe them. The fact is, Washington has a spending problem, not a revenue problem. Indeed, just look at the previous administration. According to an analysis by the House Budget Committee, Joe Biden added nearly $12 trillion to the national debt. - $4.8 trillion in enacted legislation
- $4.8 trillion in higher interest costs due to inflation
- $2 trillion by executive actions
Here at Americans for Prosperity, we believe that before politicians even think about taking another dime in taxes from any American, they need to get government spending under control. President Trump and the Department of Government Efficiency are making a real effort to reduce the size and scope of government, but they can only do so much. If we’re ever going to make lasting progress, Congress must do the heavy lifting. Before any of that, however, Congress needs to renew the Trump tax cuts and, if possible, make them permanent. We need to send a message to Washington that 17% of GDP is the absolute limit to what the American people should have to pay for their government. Americans have had to tighten their belts for years; now it should be the government’s turn! Let your elected officials know you support renewing the Trump tax cuts! Best, Joe Eule Americans for Prosperity | 
