There is one thing I need to point out though. If we really need a high level of taxation in order to avoid a deficit, how did we accumulate a 4 trillion dollar surplus? To me that is the fly in the proverbial ointment. Certainly we have had tax cuts already since the surplus was accumulated, but not huge ones. I have a real problem believing that the planned tax cuts would be enough to take us from a surplus state of cash flow to a deficit state of cash flow. In my estimation, the reason we are currently experiencing deficit spending is due to the recession. A lot more people are transitionally unemployed (including yours truly). I'm not sure where the $4 trillion surplus figure came from, but I assume it was the projections for the next 10 years or so? A couple of things on that -- pretty much all economists agreed that it was unrealistic. First, it assumed crazy impossible-to-sustain growth rates. Second, it was created by the MBO, which is a part of the White House. The MBO is far more political than the GAO, which is the Congressional version of it I believe. Since both White Houses (Clinton & Bush) would want to look good, I tend to distrust those numbers a little more. The GAO numbers were far less impressive. I agree that a good part of the deficit this year is the recession. I wouldn't be surprised if we at least got to close-to-break-even in an expansion. But taking $1 trillion out of the revenues over 10 years, I think, makes a sustained surplus fairly unlikely. Especially given that there's already talk about expanding the tax cuts and such. My concern is that if we do negative spending during a recession and net-zero spending during expansions, that just creates a growing debt. Worse -- and this is an issue for both parties -- the Social Security system is going to keep eating up larger and larger amounts of our revenue stream in coming years, so there's going to be even more pressure to deficit spend if nothing's done about it.
