Tracking the Failure

Above is a chart that tracks the rise and fall of the biggest percentage spending over a 100 year period. Notice the rise and fall of defense spending. Look at the decline of spending known as “other” which was mostly for the US post office and Natural Resources. Most importantly as the demand for pensions and health care rose, so did the national debt which is indicated in today’s dollars

The red/blue line above represents who controlled congress over this 100 year period. Also In today’s dollars the National debt of that year is to the right of that year.

What are some of the causes of the $13 trillion national debt?

Must be all those wars? If there was no War in Afghanistan, Iraq, Vietnam, S. Korea-Today’s national debt of $13.7 would be still a whopping $11.48 trillion. In other words a sliver of the problem would be shaved off.

What about those Bush Tax Cuts?

I was able to find one article that seemed non-biased.

http://www.taxfoundation.org/news/show/26314.html “How much Did the Bush Tax Cuts Cost Us?”

“When the Kennedy tax cut dropped the top income tax rate from 91% to 70%, or when the Reagan tax cut dropped it from 70% to 50%, it is quite possible that the lower rates raised more revenue than the old, higher rates would have. On the other hand, few if any of today's tax rates are so high that cutting them would generate a surge of income-producing activity so large that revenue would rise”

But then it goes on to say : “The only place we could find a recent hindsight estimate of the cost of the Bush tax cuts came from the liberal Citizens for Tax Justice who used it as an opportunity to compare the Bush tax cuts' cost to health care reform. According to CTJ, the Bush tax cuts that were passed up through 2006 (the 2001 and 2003 cuts as well as other smaller cuts in 2004, 2005 and 2006) ended up costing the Treasury approximately $2.1 trillion in foregone revenue from 2001 to 2010. CTJ claims that if you add interest payments, that number goes up to around $2.5 trillion.” …Not really as I will here discuss…but first…

Ok, there’s a number $2.1 trillion. So where does that put us? $9.38 trillion in debt if, according to CTJ, there was no Bush Tax cut. In my little “eliminate the bad guy blame game” We’ve managed to eliminate 31.7% of the problem based on my estimates. Not bad, but what about the other 70% that’s not being addressed? As you will see from the data below, this idea of lost revenue doesn’t hold its weight. Also under Bush II, social program spending (Medicare, Social Security, Welfare) actually grew, not shrunk, by 45%. But at the same time Federal Revenues reached an all time high. In other words even though Bush II cut taxes, Washington took in more money and, sad to say, government grew. So did spending on all the social programs…pretty much turns everything upside down on what we really thought what took place.

Dumb observations people make when analyzing our current situation:

Let’s go back to Reaganomics! When Reagan got into office in 1981 the national debt was at $907 billion(T$2. in today’s money). When he left office it was more than tripled to $2.6 trillion (T$4.65 in today’s money) .

Bill Clinton had a surplus! If you ever talked with a financial planner, one of the main things they will tell you is that you can never come under budget as long as you have unpaid credit card balance at the end of every month. In the years that there was a surplus we had roughly $7 trillion in debt in today’s money. A surplus is when you owe nothing but have money left over. Unfortunately in the years we had a democratic president and a republican led congress who boasted about a non existent surplus that only existed in newspaper headlines. When you owe trillions to your lenders …there really was no surplus Clinton left office. In more accurate terms we were just merely…under budget.. meaning Washington took in more than it spent and it was by a tiny margin and only by a fraction totaling $558 billion in the 4 years that we were under budget. Nevertheless we were heading in the right direction! Happy days are here again! Then came the war against terror to help us figure out how to stop men armed with box cutters from boarding planes and ramming them into buildings!

With the following study you will see that you might be voting for the wrong party.

United States Income Distribution and other economic spending facts 1947-2008

This is a break down of all the presidential terms grouped together by democrat and republican. The currency is adjusted for 2009 inflation rates. Be warned most will be caught off guard with the statics present here.

Inspired by a chart posted on Wikipedia by the same name. My research goes further pointing out details mostly in increases in federal spending. The 20% -95% on the left represent wage earner percentile with the income earned to the right of each. http://en.wikipedia.org/wiki/File:United_States_Income_Distribution_1947-2007.svg

Truman 1947-19522 ( ((7 years) Avg Inflation 4.67%, Fed Debt down 51%, Welfare Up 41%,Pensions Up 176%,HC down 40%

95% 65K to 69K Up up 6% avg annual tax revenue ($B 45)= ($300)/capita

80% 40K to 45k up 12% annual GDP increased by 23% by the end of his term

60% 28k to 33k up 13%

40% 21k to 26k up 23%

20% 13k to 15k up 15%

Dwight D. Eisenhower 1953-1960 (8 years) Avg. Inflation rate 1.36%. Fed Debt down 2.8%, Welfare up 44%,Pensions up 250%, HC up 34%

95% 69k to 88k up 27% avg annual tax revenue ($B 75) = ($441/capita)

80% 45k to 55k up 22% annual GDP increased by 25% by the end of his term

60% 33k to 40k up 21%

40% 26k to 29k up 11%

20% 15k to 17k up 13%

Kennedy/Johnson 1961 to 1968 (8years) avg. inflation rate 2.02%, Fed Debt up 1.8%, Welfare up 81%, Pensions up 48%, HC up 400%

95% 88k to 113k up 28% avg annual tax revenue ($B 162) = ($1185)/capita

80% 55k to 73k up 32% annual GDP increased by 44% by the end of these two terms

60% 40k to 54k up 35%

40% 29k to 40k up 37%

20% 17k to 25k up 41%

Nixon/Ford 1969 to 1976 (8 years) avg inflation rate 6.37%, Fed debt up 13%, Welfare up 271%, pensions up 103%, HC up 85%

95% 113k to 125k up 10% avg annual tax revenue ($B 230) = (1095/capita)

80% 73k to 79k up 8 % annual GDP increased by 19.4% by the end of their two terms

60% 54k to 57k up 5%

40% 40k to 41k up 2%

20% 25k to 24k down - 4%

Carter 1977-1980 (4 years) avg inflation rate 9.73%, Fed debt down 4%, Welfare up 1%, Pensions up 8%, HC up 11%

95% 125k to 131k up 5% avg annual tax revenue ($B 433) = ($1941)/capita

80% 79k to 83k up 5% annual GDP increased by only .5% by the end of his term

60% 57k to 59k up 3%

40% 41k to 42k up 2%

20% 24k to 25k up 4%

Reagan/Bush 1981-1993 (12 years) avg inflation rate 4.8%, Fed Debt up 164%, Welfare up 41%, Pensions up 28%, HC up 105%

95% 131k to 160k up 22% avg annual tax revenue ($B 826) = avg ($3427)/capita

80% 83k to94k up 13% annual GDP increased by 31% by the end of their two terms

60% 59k to 63k up 7%

40% 42k to 42k --------

20% 25k to 24k down -4%

Clinton 1994-2000 (8 years) avg inflation rate 2.22%, Fed Debt up 17%, Welfare up 5.5%, Pensions up 21%, HC up 41%

95% 160k to 193k up 20% avg annual revenue ($T 1.854.1) = avg ($6944/capita)

80% 94k to 110k up 17% annual GDP increased by 25% by the end of his 2 terms.

60% 63k to 73k up 16%

40% 42k to 49k up 16%

20% 24k to 28k up 16%

Bush 2001-2007 (8 years) avg inflation rate 2.69%, Fed Debt up 41%, Welfare up 40%, Pensions up 14%, HC up 41%

95% 193k to 197k up 2% avg annual Fed US tax revenue ($T 2.359.5 ) = avg ($8025)/capita

80% 110k to 112k up 2% annual GDP increased by 38% by the end of his 2nd term.

60% 73k to 75k up 3%

40% 49k to 49k -----

20% 28k to 28k --------

Obama 2009-2015 (7 years) (7 yrs avg inflation rate 1.37%, 7 yrs Fed Debt up 53%, Welfare down 9.8%, Pensions up 30%, HC up 33%

avg annual tax revenue ($T $2.5) = avg ($8081)/capita, annual GDP increased by 24% by the end of his 7th year.

2009 -2015

95% $200k up 3%

80% $106k down 3%
60% $65k  down 11%
40% $41k down 16%
20% $22k down 21%

CONCLUSION: Which party wins in each category? Below is a combined list of all the presidencies from 1947 on and their records based on the statics from above. This is how things went under either a republican presidency or democrat presidency during their time period.

Democrats

=Truman, Kennedy, Johnson, Carter, Clinton all combined

Republicans

=Eisenhower, Nixon, Ford, Reagan, Bush I, Bush II all combined

Results on who has better record for personal wealth growth.

95%

Democrats 14.5%

Republicans 15.25%

80%

Democrats 17.25%

Republicans` 11.25%

60%

Democrats 16.75%

Republicans` 9%

40%

Democrats 19.5%

Republicans 4%

20%

Democrats 18.5%

Republicans 1.25%

I was for years a registered Republican before joining the Libertarian party. I had no idea that things could be this bad for Republicans when it comes to income growth. I still don’t get it.

Inflation Rate 1947-2009

Democrats 4.42%

Republicans 3.87%

Inflation seems to go up slightly when a democrat is in office.

Unemployment Rate avg. 1947-2009

Democrats 5.20%

Republicans 5.25%

Too close to call.

Increasing the National Debt.t

Democrats 18.8%

Republicans 218%

Who is the leader when it comes to increasing the national debt? Republicans reign in supreme. Out of fairness it is congress who comes up with the budget but in most cases the President can veto the budget and request for a new one. But in the end congress holds the purse strings. The balance of power can put blame on both parties. The problem is that one party always seems to blame the other party for spending problems. The worst deficit occurred under Reagan when the federal debt grew 164%. Special note should be made to Carter’s term when the debt actually shrunk 4%. It’s hard to tell in real dollars but when you calculate the inflation it went down!

Increasing the GDP by the end of terms.

Democrats 92.5%

Republicans 90.4%

This is too close to call on a winner but it may surprise many on how close it is.

Increases in Welfare Spending

Democrats 128.5%

Republicans 520%

Again this has got to shock most people. I’m not even sure it’s correct. But the math don’t lie. The biggest jump took place during the Nixon/Ford administrations. At the start the spending in today’s dollars was $42 billion by the time Ford left office the spending was $152.91 billion. It went from 4% of the federal budget to 11.3% of the budget. Welfare now makes up for 15% of our budget today. “Johnson has gone down in the history books as the big spender for social welfare programs, yet federal spending grew faster during Nixon’s tenure than during Johnson’s. It was under Nixon that social spending came to exceed defense spending for the first time. Social spending soared from $55 billion in 1970 (Nixon’s first budget) to $132 billion in 1975, from 28 percent of the federal budget when LBJ left office to 40 percent of the budget by the time Nixon left in 1974. While Nixon would criticize and attempt to reform welfare, he nonetheless approved massive increases in funding for other Great Society programs such as the Model Cities program and the Department of Housing and Urban Development.”

-“Nixon Reconsidered” Ashbrook Center

http://webcache.googleusercontent.com/search?q=cache:NI2dTK6QY1oJ:www.ashbrook.org/publicat/dialogue/hayward.html+nixon+welfare+spending&cd=3&hl=en&ct=clnk&gl=us&client=firefox-a

Increases in Pensions Spending

Democrats 253%

Republicans 563%

I’m not too sure how this is controlled but to be fair Eisenhower got stuck with this relatively new system. If you take him and Truman out of the equation, pensions still grow twice as much when a Republican is in office: Democrats have increased pension spending such as social security spending in dollars by 70% whereas under a Republican president the spending was increased by 145%.

Increases in Health Care spending

Democrats 452%

Republicans 265%

This is known as the “Great Society” era and Democrats win thanks to the Kennedy/Johnson era we saw a 400% increase in healthcare spending with the Social Security Act of 1965 that authorized Medicare and provided federal funding for many of the medical costs of older Americans. The legislation overcame the bitter resistance, particularly from the American Medical Association, to the idea of publicly funded health care or "socialized medicine" by making its benefits available to everyone over sixty-five, regardless of need, and by linking payments to the existing private insurance system.. A new era was among us. New technologies, new life saving and life sustaining procedures were among us and the government was going to make sure we had them. That mixed in with an increase in unhealthy living habits and the rise of obesity also spurred the governent to act to assist those in need. With that also comes over $75 billion in Medicare fraud.

Avg Annual Tax Revenue

Democrats 2.186 trillion

Republicans 2.974 trillion

Again another shocker. This proves that when you cut taxes you really do bring in more revenue. On average a democrat President brought in $546 billion per year while republicans brought in $743 billion per year. George Bush II alone brought in on average $ 1.843 trillion in federal revenues. That’s an average of $6268/capita in today’s dollars. I know democrats hate to hear that. Despite all the revenue I can’t figure out the irony how republicans still do so poorly when it comes to wealth growth.

Something that I also found amazing was how little we use to pay in Federal taxes. Imagine during the Truman era the average American spent roughly $300 per capita in today’s dollar to the federal government. Or even Eisenhower when the per capita tax burden was $441( in today’s dollars). And the government still functioned!

So yeah, Republicans win when it come to collecting government revenue. The problem is it goes in one pocket and through a hole quicker than you can say “ tax cuts for the rich DOES produce more federal revenue.”

You can say that government grows more under a Republican president because people make more and that tax cuts for the rich do very little since both the rich and the government pull in more money. If you are for government growth then you should actually SUPPORT tax cuts for the rich.

Bottom line. What’s going on here? Why is it that we could survive as early as the 1950s on only $300 per person whereas today we pay over $6200 per person? I call it the redistributing the wealth , combined with a movement away from the limited government our Fathers fought for during the American Revolution. And to make matters worse even though we pay 2100% more in federal taxes per capita than we did 50 years ago, we still need to borrow billions in order to redistribute and maintain the spending for whatever spending it is. There’s a word for that too. It’s called insustainability and its bringing us right back to where we were on July 3, 1776. In the spirit of Thomas Paine’s pamphlet, “Common Sense” which helped spark the American Revolution, doesn’t common sense tell us that over $110 Trillion in unfunded liabilities, $13 trillion national debt and a per capita Federal tax increase of 2100% in just 50 years, that something is wrong?

Until we address the issues of the real spending direction that America is heading, “ the Continent will feel itself like a man who continues putting off some unpleasant business from day to day, yet knows it must be done, hates to set about it, wishes it over, and is continually haunted with the thoughts of its necessity.” Thomas Paine (the final words to “Common Sense”.)-

Sources:
http://money.cnn.com/calculator/pf/income-rank/

http://www.usgovernmentspending.com

http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Docid=200

http://www.npg.org/facts/us_historical_pops.htm

http://www.npg.org/facts/us_historical_pops.htm

http://www.miseryindex.us/urbyyear.asp

http://www.census.gov/hhes/www/income/histinc/f01AR.html

GDP