The public policy blog of the American Enterprise Institute

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Discussion: (15 comments)

  1. remember: ” Michael Barone’s prediction: Romney 315, Obama 223″

    when you talk about “big govt” – you need SPECIFICS and you need to honestly acknowledge the fact that right now we do spend about 1.5 trillion on National Defense and 1.5 trillion happens to be the entire amount of tax revenue that we have.

    When I hear folks like Barone truly and honestly address the fact that 1/2 of our “big govt” is our military and national defense that costs real money every bit as much as other spending does – then I’ll put more stock in their screeds.

    1. SeattleSam

      You’re not going to hear Mr. Barone address the fact that half of government is defense because it’s not true. Defense accounts for about 20% of the federal budget.

      1. re: defense accounts for 20%

        how about a link to the budget guy to back up your assertion?

        you are apparently including FICA/SS which you should not since they are off budget and self-contained.

        If you strip out FICA/SS what do you get?

        you get about 50% of the spending but more than that you get about 100% of our tax revenues.

        1. is a great resources for detailed data on current and historical government spending. Defense is 13% of FY13 spending.

          1. I think you’ve got the wrong spending guy:

            we spend at the Federal level about 3.8 trillion not 6



            Department of Defense including Overseas Contingency Operations 666.2 6.7 672.9
            Department of Veterans Affairs 60.4 79.4 139.7
            Department of Homeland Security 54.9 0.5 55.4
            NASA 17.8 –0.02 17.8
            National Intelligence Program 52.6 0 52.6

            800+ billion

          2. Oops. Sorry, 24% is the correct percentage of *federal* spending.

          3. You have some “issues” on “defense” spending if you neglect to recognize that “National Defense” is not just DOD spending.

            For instance, you have the VA, and military pensions and health care as well as Homeland Security, National Intelligence networks, and NASA satellites.

            the other problem you have is recognizing what percentage of available net tax revenues that “defense” spending is.

            If we take in 1.5 trillion and we spend 1.5 trillion on national defense, what does that mean?

        2. Of course if you strip out the biggest parts of the government, the portion of defense goes up. That doesn’t mean that it makes any sense to do so.

  2. SeattleSam

    A majority of the population wants things that are paid for by others. Only government has the coercive power to make that happen. Hence government will continue to grow until it no longer can. What would stop it? Possibly the intrusion of reality when such policies suppress growth enough or when creditors cut them off (as is playing out in Europe today). But, then, possibly not, since a government as large as the United States can simply renege on its obligations — either outright or by debasing the currency. That leads to even bigger government needing more power to control its citizens.

  3. MacDaddyWatch

    If Obama wants to hike tax rates back up to Clinton levels in order to recapture the economic successes of those years, then let’s make sure they also roll back government spending to Clinton levels.

    If Obama wants fairness and “balance,” then what could be more fair and balanced than matching those higher Clinton tax rates with the then lower Clinton spending levels.

    1. I AGREE! So let’s hear from the GOP on how to roll back spending – across the board – to Clinton era spending.

      how about it?

      Don’t wait on Obama – get in the game yourself!

      1. That includes the programs that you like to pretend aren’t a part of the federal budget.

  4. Max Planck

    There IS no “moral argument” and the AEI is just yanking the chain.

    From American Conservative, who are trying to rescue the GOP from itself:

    Daniel Larison says:

    December 10, 2012 at 3:19 pm
    For at least thirty years conservatives have justified lowering tax rates in terms of depriving the government of power, but the government has continually grown in size and intrusiveness anyway. Keeping taxes at their Bush-era rates or letting them go up to the Clinton-era rates isn’t going to affect the power or size of the government. It will simply determine whether we pay for more of it now or put that burden on the next generations. By reducing the price of expanded government, this low-tax position has made it easier to expand government, and of course both parties have taken advantage of this to do just that.

    The belief that there is a deeply meaningful principled difference between having marginal income tax rates at one level rather than another is silly. Anyone interested in reducing the enormous debt that the government has piled up understands that taxes are going to have to go up sooner or later in the absence of major reductions in spending, and the party obsessed with keeping taxes low has never shown much interest in making those spending reductions. But let’s ignore all of this and pretend that this has something to do with how mean TAC is to the poor Republicans.

    This was in response to an article that opened with:
    “As a general rule, no one should take advice from Marc Thiessen, and that applies doubly to his advice to Republicans on budget negotiations:”

  5. What is the moral argument? Romney failed to provide any specifics as to the fact that Obama’s policies had failed (i.e., not that they didn’t just fail to fix Bush’s failures, but that they actually failed themselves), why Obama’s policies failed, what Romney’s specific policies would be, or why Romney’s policies would succeed. But what he did do is make spending and debt a moral issue. And it went over like a lead balloon.

  6. Wow. From 15% to 35%. It seems AEI has failed and continues to fail miserably. I wonder what seminal innovation they have in the hopper to pivot. Apparently what they are doing isn’t working well at all. How can anyone hallucinate that more of it year after year will produce different results?

    I argue here they need veteran computer scientists on staff to work with their economists.


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