I could make this really easy and say "don't spend what you don't have", but that would be too simple an approach to policy and government officials couldn't get elected if that's how they approached public service. It's really insane that Dave Ramsey's meat and potatoes approach to personal spending can draw 3 million listeners a week by telling them "don't spend what you don't have", yet we don't ask this of our own federal government, we actually ask them to do the exact opposite. There is the false idea that the government does not have to operate under the same rules as the rest of us. The idea that they can spend whatever they want without passing on any cost to the American public. It is this way of thinking that has led us to the largest deficit that we have ever seen, and the leading presidential candidate proposing 150 billion dollars a year in new spending.

The problem is two pronged, the first has to do with the electorate and their ignorance to the mechanics of the federal government and their desire for more. The "nanny state" as it is called by many right wing pundits is as much a result of the public's demand for additional government benefits as it is the politicians. This desire isn't exclusive to the left, it crosses all political classifications, as of late the war in Iraq is one of the main sources of monetary drain on our government, and it is something that the majority of the right is not willing to abandon. We constantly hear from Democratic candidates that if we were not in Iraq we could be spending that money on health care, fixing social security and helping families with rising costs , this is the second prong. Surely these politicians know that the money we are spending in Iraq is money that we don't have in the treasury, yet they already have plans for that money when the war is over. When the average American gets out of debt they don't celebrate by opening up a new credit account with their increased FICA score, they adjust their lifestyle so that they can live without the shackle of debt. We should demand the same from our government and we should ask for an in depth analysis of how new programs will be funded to be made public prior to any vote.

This would never work though because politicians would be unable to promise the moon to every group of Americans. They could not lower taxes, go to war, increase public school funding, food stamp funding, prescription drug funding and so on. They could not run as "Compassionate Conservatives", meaning a social conservative that is opposed to gay marriage but a fiscal liberal that can't say no to anything. They also could not run as a "Uniter" promising tax cuts, new energy funding, cheaper health care, help with college tuition and continued funding of a near bankrupt social security system.

In every election the promise for more will trump the promise for restraint in the form of spending, and this is why the government continues to grow. On the converse is the promise for less taxes that will always win over the promise for increased taxes on the majority. This is the precise reason why Obama is where he is, he has proposed a tax plan that lessens the burden on the middle class yet gives them greater benefits from the government, while relying on corporate, excise, investment and high income taxes as a means to pay for his new spending. With all these increases most estimates have Obama coming up short on his new spending proposals and doing nothing regarding the deficit currently in place.His increase in the capital gains tax is already looking shaky, he has reported varying percentages ranging from 26% to "no more than 28%" and early on he made statements of a increase to 30% on capital gains. More recently after being told by Maria Bartiromo that 100 million Americans would be affected by the increase he responded with "And that's why I think that it may be, for example, that you could structure something in which people with certain incomes were exempted from this increase and it would stay at 15." He has even made reference to a progressive capital gains tax and has said this would be in the name of "fairness". Surely this is a argument that could go on for a long time, but the point is that his "sound economics" aren't so sound that they are immune from public pressure. His most recent blunder on the subject came during the April 16th Democratic debate in which Charles Gibson raised the issue of the lower tax rate increasing tax revenues.

Gibson: And in each instance, when the rate dropped, revenues from the tax increased. The government took in more money. And in the 1980s, when the tax was increased to 28%, the revenues went down. So why raise it at all, especially given the fact that 100 million people in this country own stock and would be affected?

Obama: Well, Charlie, what I’ve said is that I would look at raising the capital gains tax for purposes of fairness. We saw an article today which showed that the top 50 hedge fund managers made $29 billion last year – $29 billion for 50 individuals. And part of what has happened is that those who are able to work the stock market and amass huge fortunes on capital gains are paying a lower tax rate than their secretaries. That’s not fair. And what I want is not oppressive taxation. I want businesses to thrive and I want people to be rewarded for their success. But what I also want to make sure is that our tax system is fair and that we are able to finance health care for Americans who currently don’t have it and that we’re able to invest in our infrastructure and invest in our schools. . .


The issue quickly changed from one regarding the funding of new programs to an issue of fairness. When taxation is not and appropriate means of increasing revenue it becomes a means of making things fair and fairness does not pay off the deficit, it does not fix social security and it does not rectify our reliance on foreign energy. It's time we begin to assess the programs we have and working to make them more efficient so they can accomplish the intended goals or be cut out of the budget. The answer is not always new spending and new taxes. Higher tax rates don't always translate to higher tax revenues and new programs don't always result in fewer problems. Just ask Bush 2.