We continue to try to arm you with information to be a more informed voter as we head into the 2020 elections. Today's topic is not one that you hear a lot about, it is not easily understood in a twenty second YouTube video or Tweet. The issue is emblematic of the denial and inability to deal with long-term structural issues within our Washington DC institutions. These issues are difficult to deal with and will likely cause a fair amount of shared pain for many people. They are therefore not the sexy, headline grabbing issues that people like to bring up on the campaign trail.
Today's topic is how much money Congress gets to allocate and spend after all required spending is taken into account. Required spending includes the money that goes towards entitlement programs such as Social Security, Medicare and Medicaid. It also includes defense spending in the interest that we pay on our national debt, which is rising rapidly.
After all of this is paid, Congress gets to decide what to do with the remainder. This number as a percentage of federal revenues has been declining for decades. As you can see from the chart below, it hovered around 60% throughout the 1960s. It subsequently dropped into the 40% range from 1980 to approximately 2000.
After the dot.com bubble, the subprime mortgage crisis and the Great Recession, the number fell precipitously and is on a steady downward trend. This year what Congress gets to allocate is a mere 11% of what is collected in tax revenues. Fixing a problem of this magnitude requires vision and the courage to confront this openly to constituents who are NOT going to like what has happened over the last 50+ years in Washington DC.
Dr. Eugene Steuerle of the Urban Institute has been tracking this for decades. A link to his article is here. There is also a short video link here. It visually illustrates what is talked about above and it is well worth the 50 seconds it takes to watch.
At some point, we are going to have to hold our elected officials accountable. It would be great if we could overcome our differences and start holding them accountable with the upcoming election. It would help us put the country and the economy on a better course for a future that our children could look forward to. I think it's important as we keep "Moving Life Forward", for all of us.