What's the Democrats' problem? It's the spending, stupid.

The Hill

3 days ago

After four years of crisis-level spending, Democrats now worry about deficits and debt. Strange, isn't it? The Democrats' selective attention shows clearly that their priority is not deficits and debt but preserving bloated spending and raising taxes to pay for it.
Democrats have seized on a looming 2026 increase in tax rates as their baseline, instead of today's tax rates, which were lowered by the 2017 Tax Cuts and Jobs Act. By so doing, they argue that not allowing tax rates to increase above today's levels is a deficit and debt increase.
From the Democrats' point of view, tax rates going up (as they will in 2026 for average American taxpayers without legislation preventing this) equates to keeping rates unchanged. It is a neat way of transforming tax cuts that aren't into the tax hikes that will be. Such is the duplicity of the Democrats; such is the fluidity of baselines.
The baseline that the Democrats don't talk about is the one that has gotten America into today's deep deficit and debt hole, and that they supercharged with spending over the previous four years. What Democrats and the Biden administration did was to make the COVID crisis their baseline for spending and keep it there.
Looking at fiscal years, the Congressional Budget Office shows that in 2019, the federal government spent approximately $4.4 trillion — a sizable 8 percent increase over 2018. In 2020, COVID hit, and spending shot up 47 percent to $6.5 trillion.
Under Biden, it stayed roughly there: $6.8 trillion in 2021, $6.2 trillion in 2022, $6.1 trillion in 2023 and $6.7 trillion in 2024.
Crisis-level spending, even without a crisis driving it, saw Biden and Democrats run approximately $7.5 trillion in deficit spending over just four years.
Subtracting actual 2019 spending from their crisis-level spending shows nearly $8.2 trillion in spending above the 2019 level, per my calculations. Such crisis-level spending put 2024 spending 52 percent over where it had been in 2019.
Even when 2019 spending is adjusted annually for inflation (increasing 2019 spending by Consumer Price Index growth and then increasing each year thereafter) — an inflation that hit a 40-year high and that the Democrats' excessive spending helped to fuel — I estimated that Biden and Democratic crisis-level spending surpassed it by $6 trillion.
In Biden's first year, and after I adjusted 2019 spending in each of the five years for inflation, federal spending exceeded the adjusted 2019 spending level by $1.3 trillion.
Spending is the problem. Not tax revenues.
Tax revenues increased in 2019 (the first year they were collected because the rate adjustments occurred in 2018, and the lower rate revenues were paid in 2019) under the 2017 Tax Cuts and Jobs Act. They barely edged down in 2020, despite COVID. They increased again in 2021, 2022 and 2024.
In 2023, revenues fell when slower economic growth (following tax increases in Biden's misnamed Inflation Reduction Act), an end to pandemic policies and the expiration of certain tax provisions combined to lower them.
Looking at revenues and spending versus GDP underscores that excessive spending is the culprit. A March Congressional Budget Office report showed 2024 revenues below the 30-year average by just 0.1 percentage point: 17.1 percent versus 17.2 percent. In contrast, spending was over by 2.3 percentage points: 23.4 percent versus 21.1 percent.
Subtracting that 2.3 percent spending from 2024's actual deficit and the resulting deficit, I found that it would have been just 4.1 percent of GDP, exceeding the Congressional Budget Office's 30-year average of 3.9 percent by just 0.2 percentage points. Sure, it's still too high, but hardly the bloated deficits that Biden left.
To make it even clearer: Inflating 2019 spending by the Consumer Price Index over the last five years, per my calculations, it would have been nearly $5.4 trillion in 2024, instead of the $6.7 trillion that it was under Biden. That $5.4 trillion would have amounted to just nearly 18.7 percent of GDP, instead of the 23.4 percent that it was.
Calculating the deficit from our inflated 2024 spending level, I found that, as a percentage of GDP, it would have amounted to just 1.6 percent, less than half of the Congressional Budget Office's 30-year average.
With COVID, spending increased; it should have. When COVID ended, spending should have reverted to pre-crisis levels — at least to a pre-crisis level adjusted for inflation.
It did not. And it did not over each of the next four years.
Democrats' crisis-level spending has created crisis-level deficits and debt. Now, they want a disguised tax hike under the guise of paying for them.
To update the Democrats' 1992 campaign slogan: It's the spending, stupid.
J.T. Young is the author of the recent book, 'Unprecedented Assault: How Big Government Unleashed America's Socialist Left' from RealClear Publishing and has over three decades' experience working in Congress, the Department of Treasury, the Office of Management and Budget, and representing a Fortune 20 company.