Friday, May 14, 2010

Real causes of high deficits

by Joel Wendland

The government reported this week that federal deficit set a record at more than $80 billion, just for the month. They expect the total deficit for the year to easily eclipse $1 trillion.

Republicans are ranting and raving, trying to distract voters from their responsibility for the deficit which doubled when they controlled Congress and the Presidency under Bush.

Here are two basic reasons why the deficit is so high:

1. Taxes for the richest Americans have steadily declined, eroding federal revenues by hundreds of billions.

And don't give me the line that if you raise taxes on the rich there will be a recession. If that tired argument were true we wouldn't be calling the economic crisis that started in December 2007 and just now seems to be ending the "Great Recession."

2. The second main reason is Bush's war of choice in Iraq. Totaling over $720 billion today, the Republicans, who started that war and called anyone who refused to go along with it traitors, still have provided no plan to pay for it. If we follow their argument about how our grandchildren will have to pay for deficits, this trillion dollar war of choice, by definition an atrocity, will take generations to pay for.