Thursday, December 2, 2010

Wealth is Right

Just to give an idea of tax revenues over the years, look at the chart. While recently things haven't been so good, the overall trend is up. In fact, revenues have tripled since 1965. If we assume that past trends will continue, then the government will take in about $6.5 trillion 45 years from now. To put that into perspective, our population is only expected to be about 438 million in 2050. This means that the federal government can spend twice as much on every single one of us than they do today.

What's even more striking is the implication for the welfare of the average American. In order to take in that amount of tax revenue, actual productive output must increase correspondingly. This means that in aggregate, there will be a ton of money in the hands of private individuals, about 2.5 times the amount today.

What this implies is that the fiscal future is bright regardless of today's rhetoric. A good conservative strategy should be to wait it out by delaying the left's agenda for as long as possible. Liberalism's greatest argument has always been about helping those in need while it's agenda has always been one of control. One day, we will be rich enough to lift up the needy and cut down the legs of liberalism.


HealthServe said...

Taking for granted that these projections are correct and the ratios of debt to revenues remain constant or is brought into a more viable dynamic and we all have twice the money in our pockets than we have now, what historical example can you produce that indicates that any of that money will trickle down and not buy more 2050 Lexis' You my friend are a dreamer.

Adam Freund said...

I am a dreamer, not doubt. But the money doesn't have to trickle down. If the government takes in the same amount as a percentage of GDP, then it can redistribute to its heart's content.

davidschneideraz said...

This is a meaningless chart. There are more people producing more income and more exports, etc - all of which contribute to the tax base. So, if this chart showed a level or negative slope, I'd be terribly concerned. It is supposed to go up over time. IF this were a chart showing government revenue as a % of GDP and THAT went up, then there is a problem. That should remain level (or go down). But this by itself is not relative to anything else and therefore has no contextual meaning outside of being a graph.

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