U.S. Needs a 12-Step Program for Spending
Crack cocaine is one of the most addictive substances on earth. It chemically alters part of the brain called the "reward system." The drug traps dopamine in the synapses between nerve cells in the brain, reproducing the feelings of pleasure we get while eating or having sex -- a euphoric high lasting anywhere from five to fifteen minutes. But then the drug wears off, leaving the person feeling let-down and depressed, and creating a desire to smoke more crack in order to feel good again.
Research has shown that monkeys addicted to crack will press a bar more than 12,000 times to get a single dose, and the second they get it they start pressing the bar for more. On New Year's Day, America inhaled deeply on something far more dangerous and addictive than crack cocaine -- government spending.
The House finally gave in to peer pressure Tuesday night and voted to approve a Senate "fiscal cliff" bill to be signed by America's biggest drug dealer, Barack Obama. The deal increases taxes $41 for every $1 in spending cuts.
On November 6, 2012, a plurality of uninformed voters stumbled into the voting booths and despite the worst economy since the Depression, pressed the bar 59.8 million times in order to get another dose. The 57.1 million Americans who tried to remove the drug dealer from the neighborhood and the 13 million people (including 3 million Republicans) who voted in 2008 but closed their curtains and stayed home in 2012, watched on early Tuesday morning in stunned amazement as Senate Republicans, with pupils dilated and a light blue cloud of smoke following them, appeared nervously before the cameras and with straight faces denied smoking anything. The House -- with a majority of Republicans voting against it -- went along with the Senate on the deal.
The "fiscal cliff" Republicans "avoided" was the harsh terms of the Budget Control Act of 2011 which were scheduled to go into effect January 1. This included a 2% tax increase for workers as temporary payroll tax cuts expired, the end of certain business tax breaks, a rollback of the Bush tax cuts from 2001-2003, and the onset of massive tax increases that come with Obamacare. The payroll tax holiday was allowed to lapse, but the rest of the tax cuts survive -- except for the top tax rate on the rich which moved up to 39.6%.
This would not have been good for the economy, but the cliff was not all bad. According to Barron's, last year's failure to agree on a plan to cut the budget deficit by at least $1.2 trillion over 10 years would also have automatically resulted in precisely the sort of behavioral modification treatment America needs -- deep automatic spending cuts (known as "sequestration") to over 1,000 government programs, including the defense budget and Medicare payments to doctors. Sequestration would have substantially reduced but not eliminated the federal budget deficit (from 7.6% of GDP to 3.8%). But it would have been a step in the right direction.
Congress' fiscal cliff deal calls for $620 billion in new taxes while coming up with only $15 billion in spending cuts. Only a crack addict will fail to admit that the real cause of our long-term deficits is government spending, not low revenue. While revenue will surpass its historical average of 18.1 percent of GDP by 2018, spending remains above its historical average of 20.2 percent and would have reached 22.1 percent by 2022, even if the $2.1 trillion in spending cuts in the Budget Control Act had occurred. But then again, addicts always deny they have a problem. Ask a Democrat. They believe we are not spending enough. After 50 years of the War on Poverty, we are further away from victory than when we started. Yet America's addicts justify firing up the crack pipe again by reciting the worn-out anti-poverty narrative -- help the poor by spending more. Start another federal program.
America's drug-dealer-in-chief has overseen a 50% increase in our national debt, which currently is at $15,355,838,921,022.16. This is more than the gross domestic product of the entire country and more than the GDP of China, Japan, and the UK combined. In less than four years the Obama adminstration has added $6 trillion to that number. Publicly held debt has increased by 80%. Instead of admitting its problem and checking into rehab, Congress simply keeps raising the debt ceiling. Each U.S. taxpayer now owes $111,414 -- and counting. The budget deficit has now topped $1 trillion for four straight years. In a few short years we will be spending more on interest payments on the debt than on the entire defense budget.