Spending spiraling out of control
July 29, 2009 | By Nathaniel Ward
"All parts of government are growing," especially the federal budget, argues Heritage Foundation economist Brian Reidl in a new Heritage report on runaway government spending (link in PDF).
Reidl explains that bailouts, the “stimulus” package, and expansions of entitlement programs have caused federal spending to increase at a pace not seen since World War II.
» More more charts, check out Heritage's Federal Budget Chart Book
Here are some alarming statistics Riedl dug up:
- $4.004 trillion -- federal government spending in 2009, a record.
- $1.845 trillion -- federal spending beyond its means in 2009, the deficit.
- $33,932 -- federal spending per household in 2009.
- $25,969 -- federal spending per household in 2008.
- $12,072 -- tax increases required per household to pay for runaway spending on Medicare, Medicaid and Social Security by 2050. (Alternatively, we could reform the programs.)
- 46 cents -- amount of every dollar Washington spends in 2009 that will be borrowed.
- 32 percent -- increase in federal spending 2008-2009
- 13 percent -- amount of the 2009 budget deficit relative to America's economic output. This is double the previous record
President Obama has repeatedly excused the government's spending spree as a necessary, but temporary, consequence of an inherited problem. The trouble is, as Riedl notes, that this spending is far from temporary: the President's 2010 budget would "replace this temporary spending with new permanent programs."
The President's budget proposal would create annual deficits of just under $1 trillion over the next 10 years, which is double the pre-recession deficit. And this lofty figure doesn't even include the President's costly public health care plan, which Riedl says "just digs the nation's financial hole deeper."
Earlier this year, the President patted his administration on the back for saving a paltry $100 million. But there are real savings available: Riedl highlights the Congressional Budget Office's "Budget Options" book, which identifies $140 billion in potential spending cuts.
-- Amanda Reinecker
Other Heritage work of note
- On July 24, the federal minimum wage increased from $6.55 to $7.25. This is bad news for low-income workers, Heritage labor policy expert James Sherk warns in the Boston Herald, particularly in the slumping economy. "Employers will respond to this minimum-wage increase by laying off all their unskilled workers who produce less than $7.25 an hour." Many small businesses do not bring in enough profit to support the increase.
- The Congressional Budget Office estimates that the President's government-run health care plan will not accrue any real savings -- contrary to claims from the Left. These estimates serve yet another blow to the President's rushed health care agenda. In the Morning Bell, Heritage's Conn Carroll notes that the puny $2 billion of savings generated by the plan would leave "the House bill still $237 billion short of meeting Obama's promise to not add a dime to the deficit over the next ten years."
- Heritage scholar and former Attorney General Edwin Meese has been named a member of the National Security Preparedness Group. The National Security Preparedness Group is a bipartisan coalition of national security experts examining threats to the country.
- America's enemies have a way to bring the country to a standstill: detonating a nuclear weapon high over the country, creating an electromagnetic pulse that would render all electrical circuits useless. Unfortunately, Heritage's James Carafano writes in the Washington Examiner, America is cutting funds for missile defense, the best way to protect against such a catastrophe. Post your comments on the Examiner site.
- The Obama administration is seeking public input on a proposal that would allow drilling for oil and natural gas off the coast of several U.S. states. By opening up domestic energy sources, this policy would help decrease our dependence on foreign oil, which often comes from unstable or hostile nations. Drilling for oil and gas in our own backyard will create American jobs and lower prices for American families filling up their tanks and heating their homes. To express your support for this plan, visit FreeOurEnergy.com.
In other news
- In a 13-6 vote, Supreme Court nominee Sonia Sotomayor won the approval of the Senate Judiciary Committee yesterday. Sen. Lindsay Graham (R-SC), who voted in favor of confirmation, was the only lawmaker to break party lines. Sotomayor will likely become the first Latino woman to sit on the nation's highest Court after the full Senate votes next week.
- A House committee has voted to give bureaucrats new powers to arbitrarily limit pay. The Hill reports the proposal, which "would allow federal regulators to put limits on compensation packages at financial firms deemed to have taken inappropriate risks," is set for full vote this week.
- Rep. John Conyers (D-MI) has questioned the value of reading long, complicated legislation before voting on it. In a 2004 interview, the newly-elected Senator Barack Obama expressed disapproval with the GOP majority's frequent rush to vote on legislation without giving lawmakers enough time to read the bills. President Obama might offer the same advice to his Democratic colleagues today. Heritage's Stuart Butler weighs in.
- Oregon is the latest state to enact emissions controls to curb global warming.
- Billions of dollars of the so-called "stimulus" package have gone toward funding for toilet repairs and construction across the country. A spokesperson for Citizens Against Government Waste says, "This puts a whole different swirl on money going down the drain."
- British forces in Iraq will withdraw to Kuwait at the end of this month pending renewal of the Iraqi-British agreement that allows the troops to remain.
- Secretary of State Hillary Clinton said Sunday that under no circumstances would the U.S. allow for a nuclear Iran. Her remarks come in response to concerns that America was wavering on Iran.
Coming up at Heritage
To attend these or any other events at Heritage please RSVP at Heritage's website. Or you can view these events live online. All times are Eastern.
- On Wednesday, August 5 at 11:30 a.m., a panel of experts will discuss consumer products regulation and whether federal law ought to override state regulations.
- On Thursday, August 6 at 11:00 a.m., Daniel Hannan, a Member of the European Parliament from Britain, will explain why America should not go down Europe's big-government path.
Nathaniel Ward is the Editor of MyHeritage.org—a website for members and supporters of The Heritage Foundation. Amanda Reinecker contributed to this report.