This useful chart illustrates how federal spending and taxing levels have varied over the last few decades.
Clearly, federal spending has risen dramatically in recent years, while the economy has hit tax revenues. The chart is taken from an article written by Veronique de Rugy at the Mercatus Center who puts a few big-picture ideas on the table for balancing the budget.
As de Rugy notes “Since Bill Clinton left the White House in 2001, total federal spending has increased by a massive 60 percent in inflation-adjusted 2010 dollars. In fiscal year 2010, which ended September 30, the federal government spent $3.6 trillion, or 25 percent of Gross Domestic Product. That’s the most spending, in terms of percentage of GDP, since 1946. Likewise, last year’s $1.5 trillion deficit, as a percentage of GDP, was the largest deficit since 1945.”
Most people didn’t think the federal government was “too small” when Clinton left office. It would seem that some tough decisions on spending should be all that we need to eliminate the deficit and that significant tax hikes as outlined in the federal debt commission would be unnecessary if Congress and the White House get serious about cutting the federal budget down to size.