the Americans for Tax Reform Foundation calculates the
number of days that the average American must work just
to pay their taxes. The Foundation divides the sum of
federal, state and local taxes by the total national
income, to determine the “tax freedom day”.
the average American had to pay every dollar earned
through April 12th just to satisfy their tax
That news is
bad enough, but it is only the beginning of the story
being told by the Foundation.
added the costs of this year’s federal deficits and the
cost of the regulatory burdens imposed by governments,
that tax freedom day became August 12th.
According to the Foundation, the average American worker
would have to pay every penny they earn through the 12th
day of the 8th month of the year in order to
pay for the true cost of their government!
even that absurd figure is significantly understated
because the Foundation’s calculation does not include
any principle payment on our nation’s more than $14
trillion sovereign debt. In the event that our Congress
truly developed some monetary responsibility, and
actually created a plan to repay our sovereign debt over
the next fifteen years, it would add nearly another
trillion dollars per year to the cost of government.
projected federal budget for this year, without any
provision to pay down debt, stands at $3.8 trillion.
That represents a 31% increase since the 2008 budget
year. Forty percent of that astounding spending figure,
or $1.5 trillion, will be derived from borrowed money
and added to our national debt this year.
cost to taxpayers for the combined spending by all state
and local governments is expected to exceed $1.6
trillion this year. The Foundation estimates that the
total cost for businesses and individuals to comply with
government regulations will be an additional $1.8
trillion. They calculate the sum of all the taxes,
deficit spending, and regulatory compliance to be $7.4
trillion for this fiscal year.
to put that amount of money into perspective, it can be
restated as seven million four hundred thousand times a
to an annual cost of government of more than $2,000 per
month for every American man, women, and child. Once
again, that incredible figure does not include any
provision to pay down our sovereign debt.
agency, Standard and Poor’s, has been much maligned for
downgrading the quality of the U.S debt. The Obama
administration has labeled the downgrade irresponsible.
Moreover, it has been reported that the United States
Department of Justice has recently initiated an
investigation of the company. From my perspective,
attempts to blame the messenger are ludicrous. The
credit rating downgrade was a long past due “wake up
call” for Americans, and for our political leaders.
spending path is obviously unsustainable. A recent
report by the National Commission on Fiscal
Responsibility and Reform states that by the year 2025
government revenue will only be able to finance
Medicare, Social Security and the interest payments on
our sovereign debt. Every other federal government
activity will have to be either discontinued or financed
with borrowed money. No money will be available for
national defense, education, transportation, Medicaid,
prescription drugs, entitlements or any other federal
substantial portion of the nation’s more than $14
trillion sovereign debt is financed with low interest
short term bonds. Downgrades of the quality of the debt
will likely result in the requirement to pay higher
rates of interest to refinance that debt. The cost for
each one percent increase in interest is $10 billion for
each trillion dollars owed. Therefore, a one percent
interest rate increase on our $14.6 trillion debt would
cost an additional $146 billion per year!
government provides the money for about 25% of Oregon’s
total budget expenditures. The current budgets depend on
more than $14 billion of federal revenue to support our
state spending on education, public safety, human
services and transportation. We may expect that source
of funding to be significantly reduced as the federal
government becomes progressively more financially
strapped. The fact of the matter is that Oregon would
currently be receiving as much as $5 billion less per
budget cycle if our federal government was not borrowing
forty cents of every dollar that it spends.
we must put our fiscal house in order if this great
nation is to survive as we know it today. It is time to
return to a government whose activities are limited by
the tenants of our Constitution. It is time to limit
government spending to what our people can afford to
pay. It is time to stop adding to our incomprehensible
debt, and to begin to pay down this monstrous mortgage
on our children’s future.
is time for everyone to stop blaming the messengers and
to start taking action to live within our means.