To hear Barack Obama tell it, the federal government has been subsisting on a starvation diet in recent years. But then, that's the Keynesian liberal's excuse for why the economy isn't growing. Growth comes from federal spending in their universe, and even though we spent more than 20 percent of GDP during these so-called "austerity" years, it's never enough. So now Obama wants to spend us to the brink of $4 trillion, a record for federal outlays, in 2015.
His budget would increase outlays by nearly $450 billion from fiscal 2013, and almost none of it for defense. Spending in 2015 would hit 21.4% of GDP, up from 20.8% in 2013. Outlays would rise by another $1 trillion by 2020, much of it fueled by the exploding costs of ObamaCare, and would reach an astonishing $6 trillion by 2024. If Democrats do take the House and Senate, you can bet spending will rise even faster.
Mr. Obama's budget nonetheless says that the deficit will fall to $564 billion in 2015, or 3.1% of GDP. How would that happen? Well, because tax revenues are booming. Revenues hit $2.77 trillion in 2013—a new federal record—and the Obama budget foresees them growing another 20%, to $3.33 trillion in fiscal 2015. Receipts will hit 18.3% of GDP in 2015, well above the 40-year average of 17.4%, and they'll keep rising to 19.9% a decade from now. But Mr. Obama says the government is starved for revenue and thus any tax reform must raise another $1 trillion on top of all this.
Now you realize, of course, that Obama's budget proposals typically get zero votes, even among Democrats. You further realize that we will most likely not have a formal budget at all this year because Harry Reid refuses to bring one to a vote in the Senate, figuring it can do Democrats no good in a mid-term election year if their fiscal irresponsibility is passed into law in the form of a nice neat package that people can actually read. Continuing resolutions are a much less risky way to spend the nation into bankruptcy.
What the Obama budget proposal is really designed to do is light a fire under Democrat constituency groups. It puts on the record that if they want to continue to receive the federal largese on which they depend, they had better put their time, money and other resources into electing Democrats this November.
It's also worth noting that long-term projections see the federal government sucking up 19.9 percent of GDP by 2024, as compared with 18.3 percent in 2015 and 17.4 percent that has been the average over the past 40 years.
Do you know the difference between the 40-year average and where Obama wants to take us? It's $465 billion. The next time you look at the unemployment rate and wonder why more jobs aren't being created, think about how many jobs could be paid for with the money the federal government hopes to shift from the private sector to Washington over the course of the next decade.
Big government sucks up resources that are needed to sustain and advance prosperity. But they sure make life more comfortable for the political class, and as long as the electorate sees no problem with this (or fails to recognize it entirely), there is no reason to think it will stop.
