Overspending Caused Deficits
September 16, 2003
The binge in debt spending is not a result of President Bush's tax cuts, says Stephen Moore, president of the Club for Growth, which advocates tax cuts and limited government. At most, only about 25 percent of the deficits are a result of the tax cuts.
Moreover, if the Bush tax cuts generate a stronger stock market, higher business profits and more jobs, the faster levels of economic growth will be a major factor in helping generate more tax revenues to bring the deficit down. Since the president's capital gains and dividend tax cuts were enacted in May, the resulting stock market rally has increased Americans' wealth by more than $1 trillion, according to the American Shareholders Association.
The root of the huge deficits, says Moore, has been an inability of Congress and the White House to control their spending appetite:
- In the past three years, the federal budget has grown more than one-half trillion dollars.
- Some of this is attributable to justifiable expenses to fight the war on terrorism, but non-terrorism-related federal expenditures are now growing at a faster pace than at any time since Lyndon Johnson was president.
- If allowed to pass Congress, it will add $3 trillion to the national debt during the next 60 years.
- The bill is unnecessary since roughly 75 percent of seniors already have private drug benefits.
We won't rebalance our federal budget until the politicians come to grips with their addiction to overspending, says Moore.
Source: Stephen Moore, "Tax cuts are not to blame," USA Today, September 16, 2003.
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