Thursday, September 22, 2005


Where our money goes

Many Americans believe that expenditures for "welfare" are responsible for "high" taxes. I got curious enough to check out a Congressional Budget Office website titled "Historical Budget Data." I found out that in 2004 the funding for Medicaid, earned income credits, child care credits, food stamps, child nutrition, and foster care totaled 3.2% of GDP. That same year 3.9% went to Defense spending. Have I missed something? Is the Cold War still going on? Is our new "War on Poverty" going to suffer the same fate as Lyndon Johnson's small skirmish on poverty? (In 1968 9.5% of GDP went to defense and 3.2% to all domestic programs). Cohen reflects on the same issue in today's WP:

"Bush, having won a second term, cannot seek reelection and so he may never become politically accountable for his mismanagement of the nation's finances. As Johnson initially attempted, Bush is telling the American people they can have both guns and butter -- two for the price of one. In Bush's case, "guns" is the war in Iraq (and Afghanistan) and the "butter" is domestic programs such as enriched Medicare along with the war on terrorism, which Bush himself has characterized as virtually endless. In his case, though, he has not only refused to raise taxes, he has actually lowered them. LBJ could only marvel."


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