Working to Live―or for Runaway Government Spending?

moneyhat.serendipityThumb Working to Live―or for Runaway Government Spending?Tax Freedom Day arrived this year on April 17, coincidentally the same day tax returns were due. Tax Freedom Day is a calendar-based measure of Americans’ cumulative tax bill. It is calculated as the day on which Americans have worked long enough to pay all their taxes. Americans worked 107 days to earn enough money to pay this year’s combined federal, state, and local taxes. These taxes include personal income taxes, payroll taxes, corporate income taxes, and property and sales taxes.

However, this is only what Americans actually pay, not what government spends. According to the nonpartisan Tax Foundation, “if the federal government raised taxes enough to close the budget deficit—an additional $1.014 trillion—Tax Freedom Day would come on May 14 instead of April 17. That’s an additional 27 days of government spending paid for by borrowing.”

Americans currently pay more in taxes ($4.04 trillion) than they do on food, clothing, and housing combined ($3.89 trillion). The saying goes, you should “work to live, not live to work.” But the more government grows, the more Americans are working less to live and more to pay for runaway government spending. That leaves fewer resources to invest in the real engines of economic growth: private sector businesses that create jobs and produce goods and services for a market fueled by Americans’ hard-earned purchasing power.


Kathryn Hickok is Publications Director at Cascade Policy Institute, Oregon’s free market public policy research organization.

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Posted by at 05:00 | Posted in Economy, Federal Budget, Local Taxes, Oregon Government, State Taxes, Taxes | Tagged , , | 7 Comments |Email This Post Email This Post |Print This Post Print This Post
  • Freddy

    These taxes are needed for a strong central government that keeps us free and happy. At least it does for me.

  • Rupert in Springfield

    Americas founding was specifically to avoid that pitfall of democracy – the people figuring out they could vote themselves money.

    The founders had one overriding concern, and that was the posterity of the country. They wanted to avoid those things they could determine had caused the fall of other societies. To do this they relied on the idea of electing representatives that, through their wisdom, would avoid the compunctions and avarice of a direct democracy.

    Where this theory falls down is when the benefits of office become so great that the moral character and wisdom of those elected becomes tainted by the desire to hold office such that it is of lower character than those electing them. Thus begetting an even worse situation than what was to be avoided in a direct democracy.

    The people figuring out they can vote themselves money is the downfall of any society. Electing people who figure out ways to hand out money that never would have occurred to the people in the first place is even worse. 

    People say Americas problem is we have all these programs people want but nobody wants to pay for them.

    Obviously.

    However the vast majority of these programs were not the result of the people demanding their institution. No, by and large these programs were instituted by politicians well aware of their bankrupting nature, but who cared more for their reelection than the fiscal well being of the country. Instilling sloth in the populace and financial ruin in the treasury was the bargain made to retain the comforts of office for these individuals. Unintended consequences was their shield from criticism. The fact that such consequences were readily foreseen and easily forecast by even the dullest individual. 

    The solution to that is two fold – first figure out how to close down those programs people clearly are not now and will never pay for.

    Second – stop electing leaders who add to the problem by suggesting ways to hand out even more money that would never occurred to anyone otherwise.

    • valley person

       “The people figuring out they can vote themselves money is the downfall of any society.”

      Which must be why Denmark, Sweden, Norway, Finland, Germany, and the Netherlands are all now broken societies. They voted themselves too many benefits.

  • valley person

    Tax freedom day to be followed by:

    Go to war in the Middle east day
    Keep shipping lanes open day
    Support Israel day
    Keep your grandparents housed, fed and healthy day
    Enjoy your national parks day
    Protect our borders day
    Keep poor moms and kids fed day
    Conserve our soil day
    Keep our water and air clean day
    Lock criminals up day
    Thank a fire fighter day

    and finally: Why all these services are not free remains a mystery day

     

    • JoelinPDX

      And at least half of these government functions are illegitimate. Why is it the government’s job to keep our grandparents fed and healthy, run the National Parks, feed anyone…including moms and kids, conserve the soil, keep air and water clean or fight fires? 

      Basically, all of these things are not the legitimate province of the federal government. The others provide for the common defense  (whether you like it or not) and are therefore legitimate.

      No one says we shouldn’t have some taxation…such as tariffs…to pay for what the government legitimately provides. What we say is there is no need for a national income tax of 40 percent. Probably eight to ten percent would be more appropriate.

  • Bob Clark

    To ensure the continued viability of the U.S government probably the best course forward is to freeze government spending indefinitely, continue easy money policy until the federal spending/revenue gap closes, and keep stable tax rates.  Moreover, roll back government regulations to the 1990s.  These things should help boost economic growth, and substatnially close the federal spending/revenue gap over the course of the next decade.

  • HBguy

    I look forward to the day American voters have the opportunity to vote for either:

    Low taxes and major cuts in spending (except military) to reach a sustainable budget

    or

    Higher taxes and smaller cuts in spending to reach a sustainable budget.

    As of yet, Republicans won’t tell the voters the truth about how their plan will require massive cuts in spending that will change America as we know it. And Democrats won’t explain to voters that large tax increases have to be imposed on the middle class as well as the high earners if we’re to sustain all current government responsibilities.

    Of course, if a major party candidate did actually debate the issues honestly based on actual facts, they’d likely be primaried out of office.  

    So, the R’s pretend that tax cuts will increase tax collections (untrue) and Democrats continue to believe that government spending can continue to grow at a rate higher than the growth of GDP and we can simply raise taxes to cover the cost (we can’t)

    And they all know better, but their short term job security is more important than the future of our country.

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