CBO Report: 2012 U.S. deficit officially $1.1 trillion
It’s official: the U.S. has its fourth straight deficit of more than one trillion dollars. According to the Congressional Budget Office’s (CBO) Director’s Blog, the 2012 deficit was $1.1 trillion, or about 7% of the nation’s Gross Domestic Product.
Obviously, deficits are primarily a two-factor equation: on the one side, you have revenues, and on the other you have spending. While President Obama does not deserve full blame for all four massive deficits – he was only partially responsible, as President, for the 2009 spending levels, and of course tax revenues were down in 2009, mostly not due to anything he had done – he has certainly done very little to reverse the trend.
What can be done? Obviously, Tea Party activists know the answer – balance the budget in the next couple of years, eliminate many regulations, shrink the scope of the federal government by a significant margin, and enact major tax reform. However, since both parties seem to be willing to ignore these necessities, what else can we do at the grassroots level to at least swing the dial in our direction? While there is no one answer, here are a few suggestions that could make a solid difference in years to come:
1. Regarding regulations, stop prevention of necessary energy resource cultivation, including but not limited to nuclear power and various forms of drilling. This would provide employment to the unemployed, increased tax revenue to the federal government for deficit reduction, and help with national security concerns.
2. On spending, consider the following:
a. $25 billion a year is spent on unused federal property.
b. Approximately $17 billion is spent on agricultural subsidies annually.
c. Over $20 billion annually is spent on energy subsidies.
d. $100 billion of taxpayer money is used for corporate welfare annually.
Potentially several hundred billion dollars is being wasted – annually – on fraud, waste, abuse, and duplication. While much of this is hard to eliminate, even getting rid of one-fifth of it would be extremely helpful with regards to the budget.
3. On tax reform, proponents of big government are partially correct: the federal government does need more tax revenue. However, there is no need to raise tax rates on the wealthy or anyone else. What could happen is some combination of the following:
a. Cut loopholes and lower rates equivalently.
b. Cut loopholes and put the extra revenue towards deficit reduction.
c. Cut loopholes and put some of the extra money towards deficit reduction, while the rest goes towards lower rates.
Any of the above options would be helpful for economic growth and budget-balancing reasons. Obviously, it would be preferable to cut loopholes and lower rates exclusively, but using increased revenue for deficit reduction is economically sound as well.
For years now, Tea Party activists have called for balancing the budget ASAP and making the tax code more economically and morally fair. While Congress has, by and large, refused to budge on these demands, the above suggestions could be a way for grassroots activists to at least get a good first step in towards eventual control of Washington by true fiscal conservatives. At the very least, it would prevent next year’s deficit from being as ghastly large as the 2009, 2010, 2011, and 2012 ones were. And that, in and of itself, is at least a partial victory.