For the last two years we've heard the same mantra from the GOP and its mouthpiece, FOX News: "We have a spending problem, not a revenue problem." It's usually said with solemnity and sometimes a hint of compassion, as if the speaker understands how painful this hard Truth is for fiscal weaklings.
"spending problem" is, of course, all about "entitlements"--especially Medicare,
Medicaid and Social Security. It's not about our military spending, even though
the U.S. spends as much on defense as the
next 14 countries combined.
Compared to our potential
"enemies," we spend five times as much as China, ten times as much as Russia,
and 95 times as much as Iran. These ratios are crazy. Moreover, our defense
budget is at a historic high.
As shown in the chart below, even
apart from the cost of the war in Afghanistan, the U.S. is spending more in
constant dollars on its military now than it did at the height of the wars in
Korea and Vietnam. Obama continues to spend as much as Reagan did at the peak
of his cold war struggle with the Soviet super power. However, Reagan started
cutting back as the Soviet Union moved toward dissolution in 1989, and this
reduction continued under Bush I and Clinton.
by Center for Strategic and Budgetary Assessments
President Eisenhower, a five-star
general and former commander of allied forces in Europe, would have been very
aware of America's military needs. Yet his defense budget, in the midst of the
Cold War, was $300 billion less than Obama's. With the end of the wars in Iraq
(2010) and Afghanistan (2014), why aren't we seeing reductions at least as
great as those after Korea (1953), Vietnam (1975) and the Cold War?
Let's stop gorging a bloated
bureaucracy known for its waste and sloppy financial management. The U.S.
Government Accountability Office complained
in 2011 and 2012 of " serious
financial management problems at the Department of Defense (DOD) that made its
financial statements unauditable."
By bringing our defense budget down
to Eisenhower, Nixon or Clinton levels, we could save between $150 and $300
billion each year ($1.5-3 trillion over the ten-year period for which we set
our deficit-reduction targets).
The GOP mantra claims the deficit
is "not a revenue problem," meaning we can't or shouldn't get more revenue by
raising taxes. Even though, as Foreign
Affairs put it recently, "Compared with other developed countries, the
United States has very low taxes."
Conservatives tell us we need to
keep those taxes low because raising taxes on income or businesses will make
our economy less competitive in the global marketplace. It will cause investors
to lose heart and be a slap in the face of "job creators."
this claim by looking at other advanced capitalist democracies with higher taxes.
Are they trailing us in the global economy? Let's focus on northern Europe
where, according to Conservatives, monster governments maraud their economies, sucking
up private capital to feed generous social programs that morally stunt their
tax revenue as a percentage of gross domestic product (GDP) is 26.9%. Germany,
the EU's economic powerhouse, weighs in at 40.6%. And--no surprise--Denmark tops
out at 49%, followed closely by Sweden (47.9%), and both Finland and Norway at 43.6%
it like under the oppressive Danish government? The Heritage Foundation and the
Wall Street Journal publish an annual Index of Economic Freedom (defined as governments "allow[ing] labor, capital and goods
to move freely, and refrain[ing] from coercion. . . beyond the extent necessary
to protect and maintain liberty itself") . The 2013 Index ranks Denmark
higher than the U.S.
Bank's International Finance Corporation annually ranks national economies on
"ease of doing business" (with emphasis on simplicity of regulations,
protection of property rights and ease of starting a local firm). The U.S. is 4th, Denmark 5th
and Norway 6th out of 185 nations.
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