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Notes -
This is not true.
The budget for 2025 will be around $7.3 billion in spending and $5.5 billion in revenue, with a deficit of $1.8 trillion.
To close the gap via taxation alone, we would need to increase revenue by 32.7%. But the tax rates today are only slightly lower today than in 2001. Employment taxes have not changed. Personal tax brackets are changed only a small bit (the top bracket is 37 now vs 39.6 then). And some taxes have increased! For example, there is the 3.8% Obamacare surcharge on capital gains. The biggest reduction was in the corporate tax, but corporate taxes are only a small percentage of revenues.
It gets worse. Even if we increased tax rates by an incredible 32.7%, tax receipts would not actually increase 32.7%. People would work less. They would avoid taxes more. The economy would shrink. We would need to increase taxes by a LOT more than 32.7% to balance the budget. It may not even be possible, since at some point increasing tax rates actually decreases tax revenue.
Expenditures, meanwhile, have grown by leaps and bounds. In 2001, total outlays were just $1.862 trillion, less than 18% of GDP. In 2025, federal outlays will exceed 25% of GDP.
What’s the source on the deficit? I think we need to borrow about 1t every 100 days so 1.8t is probably too small.
https://www.cbo.gov/publication/59946
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