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Tuesday, July 26, 2011 12:24:21 AM
CHART OF THE DAY: Washington, We Have A Revenue Problem
Joe Weisenthal | Jul. 25, 2011, 11:44 AM
The standard refrain on the right these days is that Washington has a spending problem, not a revenue problem.
So economist Menzie Chinn put that to the test, and guess what: It's pretty clear Washington does have a tax problem. While outlays as a percentage of GDP are near all-time highs, tax revenue + entitlement contributions is near an all-time low, and well below average.
If you believe that this gap needs to be shrunk, it's impossible to think it can be done on the cost-side at all.
Of course, any politician who says Washington has a spending problem, rather than a revenue problem, is speaking from a position of anti-tax ideology, rather than empirical data, so a rebuttal is probably pointless.
Joe Weisenthal | Jul. 25, 2011, 11:44 AM
The standard refrain on the right these days is that Washington has a spending problem, not a revenue problem.
So economist Menzie Chinn put that to the test, and guess what: It's pretty clear Washington does have a tax problem. While outlays as a percentage of GDP are near all-time highs, tax revenue + entitlement contributions is near an all-time low, and well below average.
If you believe that this gap needs to be shrunk, it's impossible to think it can be done on the cost-side at all.
Of course, any politician who says Washington has a spending problem, rather than a revenue problem, is speaking from a position of anti-tax ideology, rather than empirical data, so a rebuttal is probably pointless.
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