It looks like the U.S. Government takes in taxes at least about 50% of the national income, and borrows another 50%. If this is true, it means that the entire national income - everything that we earn - the government spends on the project it deems important, such as Iraq.
It’s pretty serious. I’ll tell you what my sources are - please let me know if I am making a mistake in my numbers.
The first quote is from Harry Browne, who referred to the U.S. Census Bureau:
“Today federal, state, and local taxes consume 47% of the national income. “
In fact, it is a very conservative estimate because it is based on the year 1995, after which the government publications stopped publishing this series. I suspect the percent of the government intake did not become smaller after the nineties.
Another reference is from another Brown, Gordon Brown:
“Net debt is now … 47% in America,…”
Where do I go wrong?.
4 responses so far ↓
1 lpcowboy // Apr 24, 2008 at 3:38 pm
While government spending is large, you may be counting some of it twice. For example the money the government spends from taxation or as part of the deficit is taxed when earned by indviduals.
Also some of it is less obvious. For example government personnel spend their money on personal items which were indirectly paid for by taxes.
2 Zak Maymin // Apr 24, 2008 at 3:50 pm
I am not sure I understand you. If I earned $100, paid $50 in taxes, then the government paid somebody for consulting or siomething that $50, and he paid $25 in taxes, the total tax is $75, but the total income is $150, so the ratio stays the same.
The second argument I also don’t unsderstand. Even If the government personnel burned the money, how does it change the ratio?
3 Goliath // Apr 25, 2008 at 2:00 am
Zak,
At the same time the government is taking your $50, it is borrowing $50 from China. The government is effectively acting like a teenager in a mall with her daddy’s credit card. The people in power will be long gone before it comes time to return this money to China. One day China will want its money back, hopefully we will have a way to pay them and they don’t have to take it by force. Either way times are only going to get worse, as the young people of today are the ones who are going to have to come up with a way to deal with these debts. It’s never a good story when dad finds out his credit card is maxed out.
If Our government takes half and owes the other half to someone else, we are effectively slaves to the government. Everything we make is already spent, they are just letting us keep half of our paycheck for the time being.
4 Zak Maymin // Apr 25, 2008 at 8:18 am
Amen, brother.
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