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Spending, Taxes, & Deficits:A Book of Charts
Brian RiedlSenior Fellow, Manhattan Institute
September 2019
Highlights
2
-- 90% of Rising Deficit is From Social Security & Medicare Shortfalls (p. 16)
-- Why the Deficit Could Top $3 Trillion Within a Decade (20)
-- Each 1% Interest Rate Rise Adds $11 Trillion to 30-Year Debt (21)
-- What Happened to the 2011 BCA Spending Caps? (29-30)
-- What is Driving CBO’s Projected $80 Trillion Deficit over 30 Years? (39-45)
-- A Menu of Tax Increase Options (56)
-- Democratic Presidential Proposals Would Cost up to $72 Trillion (60)
-- Does the U.S. Have the OECD’s Most Progressive Tax Code? (80)
-- Is it Possible that the 1980s Defense Build Up Paid for Itself? (84)
-- What Really Caused the 1990s Budget Surpluses? (85)
-- The Comprehensive Bush Budget Record (87-88)
-- The Comprehensive Obama Budget Record (89-96)
Methodology
Nearly all charts were built with publicly-available government data from the Office of Management and Budget (OMB), Congressional Budget Office (CBO), U.S. Treasury, Council of Economic Advisors (CEA), Bureau of Labor Statistics (BLS), Bureau of Economic Analysis (BEA), and Census Bureau.
Unless otherwise noted, short time periods are expressed in nominal dollars, medium time periods are expressed in inflation-adjusted dollars, and long time periods are expressed as percentage of the economy.
Sources for any chart can be obtained by contacting Brian Riedl at [email protected].
3
Charts are Organized into 9 Chapters
1) Rising Budget Deficits and National Debt
2) What is Driving the Debt? Soaring Federal Spending
3) Discretionary Spending is Not Driving the Long-Term Debt
4) Mandatory Spending and Entitlement Costs are Rising Rapidly
5) Can’t We Just Raise Taxes, Cut Defense, & Nationalize Health Care Instead?
6) Tax Revenues Will Continue Growing Faster Than the Economy
7) The Tax Code Has Become Increasingly Progressive
8) Countering Tax, Spending, & Deficit Myths of the 1980s Through 2008
9) A Comprehensive Accounting of the Obama Fiscal Record
4
Background: Budget Deficits are Heading Above Their Historical Average
6
-30%
-25%
-20%
-15%
-10%
-5%
0%
5%
1930 1940 1950 1960 1970 1980 1990 2000 2010 2020
Pe
rce
nta
ge
of
GD
P
Fiscal Year
Hi-30%
(1943)
-6%
(1983)
2%
(2000)
-7%
(2029)-10%
(2009)
Source: OMB Historical Table 1.2, and
January 2019 CBO (current-policy) Baseline Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Budget Deficits are Once Again Soaring(Adjusted for Inflation)
7
-$2,000
-$1,500
-$1,000
-$500
$0
$500
1990 1995 2000 2005 2010 2015 2020 2025
Infl
ati
on
-Ad
jus
ted
(2
01
9)
$B
illi
on
s
Fiscal Year
-$196
(2007)
-$1,786
(2029)
-$898
(2019)
CBO BaselineHistorical
-$1,662
(2009)
$341
(2000)
-$392
(1990)
Source: OMB Historical Table 1.1, and January 2019 CBO
(current-policy) Baseline, adjusted in to 2019 dollars.Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
8
The National Debt is Set to More than Double its Pre-Recession Level
0%
20%
40%
60%
80%
100%
120%
1940 1950 1960 1970 1980 1990 2000 2010 2020
De
bt
He
ld b
y t
he
Pu
bli
c (
%G
DP
)
Fiscal Year
Historical Debt as a Percentage of GDP
CBO
Baseline
106%
(1946)
23%
(1974)
48%
(1993-95)
105%
(2029)
39%
(2008)
Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Source: OMB Historical Table 7.1, and January 2019 CBO (current-policy)
Baseline Table 1-1. Figures refer to Debt Held by the Public
CBO Long-Term Baseline Shows Unsustainable Debt
9
0%
30%
60%
90%
120%
150%
1940 1950 1960 1970 1980 1990 2000 2010 2020 2030 2040
Deb
t H
eld
by t
he P
ub
lic (
%G
DP
)
Fiscal Year
Projected Debt Levels
Historical Debt Levels
48%
(1993-1995)
23%
(1974)
144%
(2049)
78%
(2018)
35%
(2007)
106%
(1946)
Author: Brian Riedl,
Manhattan Institute -
- @Brian_RiedlSource: CBO 2019 Long-Term Budget Outlook
Note: This is the rosy scenario that assumes no wars, no
recessions and continued low interest rates.
It also assume all tax cuts expire as scheduled.
CBO Projects $2 Trillion Budget Deficits Within a Decade, Assuming Current Policies are Extended
10
-$779-$898
-$1,021-$1,149
-$1,279-$1,387-$1,444
-$1,536-$1,643
-$1,825
-$2,022-$2,188
-$2,500
-$2,000
-$1,500
-$1,000
-$500
$0
2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029
No
min
al $
Bil
lio
ns
Fiscal Year
Source: OMB Historical Table 1.1, and January 2019 CBO
(current-policy) Baseline, Table 5.1Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Background: Federal Spending & Taxes: 1930-2029
12
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
1930 1940 1950 1960 1970 1980 1990 2000 2010 2020
Pe
rce
nta
ge
of
GD
P
Fiscal Year
Revenues
Spending
Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Source: OMB Historical Table 1.2 (1930-2018), and
January 2019 CBO (current-policy) Baseline.
Rising Spending – Not Falling Revenues –Drives the Long-Term Deficit
13
0%
5%
10%
15%
20%
25%
30%
35%
1962 1972 1982 1992 2002 2012 2022 2032 2042
Pe
rce
nta
ge
of
GD
P
Fiscal Year
20.0%
(1960-2018)
17.4%
(1960-2018)
Federal Spending
Tax Revenues
30.8%
(2049)
18.1%
(2049)
Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Source: CBO 2019 Long-Term Budget Outlook,
adjusted into current-policy baseline
Over the Next Decade, Above-Average Spending Will Drive Most of the Rising Deficit
14
10%
12%
14%
16%
18%
20%
22%
24%
26%
28%
30%
1960 1970 1980 1990 2000 2010 2020
Pe
rce
nta
ge
of
GD
P
Fiscal Year
Revenues
Spending 24.1%(2029)
17.0%
(2029)1960-2018 Average: 17.4%
1960-2018 Average: 20.0%
Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Source: OMB Historical Table 1.2 (1930-2018), and
January 2019 CBO (current-policy) Baseline.
Entitlements Remain the Lead Driver of Budget Deficits
15
-$2,500
-$2,000
-$1,500
-$1,000
-$500
$0
2008 2011 2014 2017 2020 2023 2026 2029
Bu
dg
et
De
fic
it in
No
min
al $
Bil
lio
ns
Fiscal Year
$-459
(2015)
$-1,633
Underlying CBO Budget Deficit -- Driven by
Social Security, Health Benefits, & Debt Interest
$-1,415
(2009)Deals Raising
Discretionary
Spending Caps$-309
$-247
Deficit Driven
by Recession
& Federal
Response
Source: Calculated using CBO 2019 (current-policy) Baseline data.
Assumes that new tax cuts are renewed.
Resulting interest costs are incorporated into each category.
Author: Brian Riedl,
Manhattan Institute --
@Brian_Riedl
Rising Social Security & Medicare Shortfalls Drive 90% of Rising Deficit Between 2019-2029
-$2,500
-$2,000
-$1,500
-$1,000
-$500
$0
$500
2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029
Bu
dg
et
De
fic
it in
No
min
al $
Bil
lio
ns
Fiscal Year
$-78
$-1,656General Revenue Transfers to Pay
Social Security & Medicare Benefits
$23$-309
$-247
All Other Policies
$-157
$-440
Annual deficit is projected to rise
from $898 billion to $2,188 billion
Source: Calculated using Jan 2019 CBO (current-policy) Baseline and CBO 2019 Long-Term Baseline.
Assumes that new tax cuts are renewed.
Resulting interest costs are incorporated into each category.
General revenues include interest payments on trust funds, as they represent a net cost to the rest of the budget.
Author: Brian Riedl,
Manhattan Institute -
- @Brian_Riedl
Rising Social Security & Medicare Shortfalls Drive 90% of Rising Deficit Between 2018-2029
-85 -78 -64 -84 -141 -180 -129 -94 -84-11 -29 23
-163 -223 -262 -275 -245 -224-209 -208 -179 -251 -286 -309
-135-157 -178 -166 -174 -184
-193 -202 -213 -223 -234 -247
-396-440
-516-624
-718-799 -914 -1032 -1167
-1340-1474
-1656
-$2,300
-$1,800
-$1,300
-$800
-$300
$200
2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029
Bu
dg
et
Su
rplu
s/D
efi
cit
in
No
min
al
$B
illi
on
s
Fiscal Year
-1643
General Revenue Transfers to Pay Social Security & Medicare Benefits
2017 Tax Cuts (Extended)
All Other Policies
-1149-1021
-898-779
-2022
-1279
-1536
-1825
-1387 -1444
Discretionary Spending Cap Increases
-2188
Author: Brian Riedl,
Manhattan Institute -
- @Brian_Riedl
Each category includes the portion of interest on the national debt that it is responsible for.
General revenue transfers include interest payments on trust funds, which are a net cost to the rest of the budget.
Source: Calculated using Jan. 2019 CBO (current-policy) Baseline and CBO 2019 Long-Term Baseline.
-$10.7
-$2.7 -$2.2
-$0.9
-$12
-$10
-$8
-$6
-$4
-$2
$0
$T
rill
ion
s o
f N
om
inal D
oll
ars Higher Discr..
Caps2017 Tax
CutsRest of the
Budget
Impact on 2019-2029 CBO Budget Deficit
General
Revenue
Transfers to
Soc. Security
& Medicare
Author: Brian Riedl,
Manhattan Institute --
@Brian_Riedl
Major Components of $16.4 Trillion Deficit Projected Over 2019-2029 Period
Source: Calculated using Jan. 2019 CBO (current-policy) Baseline and CBO 2019 Long-Term Baseline.
Assumes that new tax cuts are renewed.
Resulting interest costs are incorporated into each category.
General revenues include interest payments on trust funds, as they represent a net cost to the rest of the budget.
Note: General revenue transfers to Social
Security & Medicare will grow from $440 billion
to $1,656 billion between 2019 & 2029
Net Interest Costs are Set to Rise Dramatically
19
$0
$100
$200
$300
$400
$500
$600
$700
$800
$900
1990 1995 2000 2005 2010 2015 2020 2025
Infl
ati
on
-Ad
juste
d (
2019)
$B
illi
on
s
Fiscal Year
$849
(2029)
CBO Baseline
Spending on Net Interest
$383
(2019)
$327
(1990)
Source: OMB Historical Table 3.2 and January 2019 CBO (current-policy)
Baseline Table 1.1 adjusted for inflation into 2019 dollarsAuthor: Brian Riedl, Manhattan Institute -- @Brian_Riedl
20
If Interest Rates Return to 1980s or 1990s Levels, Net Interest Costs – and Thus the Deficit – Will Soar
-$4,500
-$4,000
-$3,500
-$3,000
-$2,500
-$2,000
-$1,500
-$1,000
-$500
$0
$500
2000 2004 2008 2012 2016 2020 2024 2028
Su
rplu
s/D
efi
cit
in
No
min
al $
Bil
lio
ns
Fiscal Year
Baseline1990s Interest Rates1980s Interest Rates
-$161
(2007)
-$3,238
(2029)
$236(2000)
Historical and CBO Current-Policy Baseline Deficits
-$1,413(2009)
-$4,318
(2029)
-$2,188
(2029)
Source: Calculated using January 2019 CBO (current-policy) Baseline
data and CEA historical interest rate data. Amounts in nominal $billions Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
21
Rising Interest Rates Would Push the National Debt Past 250% of GDP Within 30 Years
0%
50%
100%
150%
200%
250%
300%
2019 2024 2029 2034 2039 2044 2049
Na
tio
na
l D
eb
t a
s a
%G
DP
Fiscal Year
9%
CBO Baseline
(with current-policy adjustments)
Assumes 3% - 4% interest rate after 2029)
7%8%
6%
5%
226%
244%
262%
280%
210%
194%
21
Source: Calculations using the 2019 CBO Long-Term Baseline.
Alternative scenarios assume higher interest rates phase-in between 2030 & 2049.
Most economists agree that a steeply rising debt will raise interest rates.
Author: Brian Riedl,
Manhattan Institute --
@Brian_Riedl
Average interest paid rate on national debt:
1980s – 10.5%
1990s – 6.9%
2000s – 4.8%
2010-18 – 2.1%
2019-29 – 3.1% (CBO projection)
2049 – 4.2% (CBO projection)
Projected New Federal Debt Added by Decade– Unless Reforms are Enacted
22
$3.9
$9.0
$13.7
$23.6
$38.6
$0
$5
$10
$15
$20
$25
$30
$35
$40
$45
1990s 2000s 2010s 2020s 2030s 2040s
Infl
ati
on
-Ad
jus
ted
(2019)
$T
rillio
ns
Decade
$1.3
Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Source: CBO 2019 Long-Term Budget Outlook
adjusted to reflect the current-policy baseline.
Washington Now Spends More Than $34,000 Per Household
$0
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
$40,000
$45,000
1990 1995 2000 2005 2010 2015 2020 2025
Infl
ati
on
-Ad
juste
d (
2019)
Do
llars
Fiscal Year
$23,827
(1990)$24,265
(2001)
$42,806
(2029)
$28,648
(2007)
$34,240
(2019)
CBO January
2019 Baseline
Actual Spending per Household
23
Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Source: OMB Historical Table 1.1, January 2019 CBO
(current-policy) baseline, and Census Bureau data
Each Household’s Share of the National Debt
24
$0
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
$140,000
$160,000
$180,000
$200,000
$220,000
1990 1995 2000 2005 2010 2015 2020 2025
Infl
ati
on
-Ad
jus
ted
(2
01
9)
Do
lla
rs
Fiscal Year
$60,971
(1990)
$102,039
(2008)
$77,563
(2000)
$174,678
(2019)
$215,333
(2029)
Historical
CBO Baseline
Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Source: OMB Historical Table 7.1, January 2019 CBO
(current-policy) Baseline, and Census Bureau.
Federal Spending Will Rise by $304 Billion in FY 2019
25
$0
$10
$20
$30
$40
$50
$60
$70
$80
$90
RetirementPrograms*
Interest OtherEntitlements
Defense Non-DefenseDisc.
TimingShifts**
Inc
rea
se
in
No
min
al $
Bil
lio
ns
$59
$40
$53
$82
$22
$48
Source: CBO January 2019 Baseline
Author: Brian Riedl,
Manhattan Institute
-- @Brian_Riedl
*Retirement programs include: Social Security (OASI), Medicare, Civilian Retirement, and Military Retirement.
**$40 billion in 2018 spending was shifted to the end of the 2017, which made 2018 spending appear
smaller, and thus the 2019 increase appear larger.
27
Despite Recent Increases, Discretionary Spending Remains Below its Historic Average
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
1962 1970 1978 1986 1994 2002 2010 2018 2026
Fe
de
ral S
pe
nd
ing
(%
GD
P)
Fiscal Year
Non-Defense Discretionary
Defense Discretionary
9.1%
(1968)
2.9%
(1999-2001)3.1%
(2019)
2.8%
(2029)3.3%
(1962)
5.0%
(1980)
3.2%
(2019)2.8%
(2029)
Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Source: OMB Historical Table 8.4, and January
2019 CBO (current-policy) Baseline.
Since 1990, Non-Defense Discretionary Spending Has Grown 3 Times Faster than Defense
$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
$1,800
Infl
ati
on
-Ad
jus
ted
(2
01
9)
$B
illi
on
s
Fiscal Year
Non-Defense: Up 88%
Defense: Up 25%
(Includes war spending)
$356
(1990)
$670
(2019)
$533
(1990)
$664
(2019)
28
Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Source: OMB Historical Table 8.1, and CBO January
2019 Baseline, converted into 2019 dollars
29
Budget Deals Weakened the Budget Control Act (BCA) Discretionary Spending Caps
933
1,013
1,090
1,0501,043
1,012
975 995 1,016 1,040 1,0651,092
1,1191,146
$800
$900
$1,000
$1,100
$1,200
$1,300
$1,400
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
$B
illi
on
s o
f B
ud
ge
t A
uth
ori
ty
Fiscal Year
Black – 2008-2012 Actuals & Original 2013-2021 CBO Baseline
Blue – Original 2013-2021 BCA Caps
Red – Final Figures After Budget Deals
1,208
1,245
1,066
1,0141,012
1,070
992
1,288 1,298
Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Source: Congressional Budget Office
Excludes OCO and emergency spending.
Amounts in nominal $billions
What Became of the $1,788 Billion in Promised 2013-2021 Discretionary Savings Under the Budget Control Act?
30
Promised
Figures assume lawmakers stick to the
2020-2021 spending deal.
*Other savings consist of mandatory
savings and revenue increases.
Lawmakers also circumvented the caps
through the ChIMPs gimmick, and by
adding extra defense money to the Iraq
& Afghanistan “emergency” bills that
do not count against these spending
caps.
$488 billion was
repealed (27%)
$1,015 billion was
enacted (57%)
$285 billion was
replaced by other
savings thru 2029
(16%)*
Author: Brian Riedl, Manhattan Institute -- @Brian_RiedlSource: Calculations based on CBO Data, as of August 2019.
Statutory Budget Caps Sharply Reduce Discretionary Spending – Until They are Ignored After a Few Years
0%
2%
4%
6%
8%
10%
12%
1969 1974 1979 1984 1989 1994 1999 2004 2009 2014 2019 2024 2029
Dis
cre
tio
na
ry S
pe
nd
ing
(%
GD
P)
Fiscal Year
Baseline
Budget Control
Act, 2013-2021Several Multi-year
Budget Deals
Covered 1986-2002
2009
Stimulus
Source: OMB Historical Table 8.4, and January 2019 CBO (current-policy) Baseline.
Author: Brian Riedl,
Manhattan Institute --
@Brian_Riedl
The Six Major Deficit-Reduction Deals Since 1983 Relied Mostly on Discretionary Savings
32
New Taxes
18.8%
Discretionary
Savings 52.8%
Medicare
Provider
Cuts
Other
Mandatory
Savings
8.0%
Interest
Savings
11.9%
8.4%
Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
The 6 Largest Deficit Reduction Deals Since 1983 Were:
1983 Social Security Deal (Saved 0.52% of GDP)
1985 Gramm-Rudman Hollings Act (1.72%)
1990 Bush “Andrew Air Force Base” Deal (1.45%)
1993 Clinton Budget Deal (1.08%)
1997 Balanced Budget Deal (0.72%)
2011 Budget Control Act (1.01%)
Savings listed as scored at time of enactment. Many cuts
were later reversed, and the 1985 law was invalidated by the
Supreme Court and replaced with a 1987 version.
Source: Brian Riedl “Getting To Yes: A History Of Why
Budget Negotiations Succeed, and Why They Fail” (2019)
Combined Components of the 6 Deals
34
Major Components of the 2019 Federal Budget
2019 Outlays $Millions Per
Household%
Social Security $1,046,955 $8,125 23%
National Defense 684,568 5,312 15%
Medicare 651,199 5,053 14%
Medicaid 418,681 3,249 9%
Net Interest 393,498 3,054 9%
Income Security Programs 349,458 2,712 8%
Veterans Benefits 200,458 1,556 4%
Education 112,863 876 2%
Justice Administration 71,780 557 2%
Health Research & Regulation 68,678 533 2%
Highways & Mass Transit 63,580 493 1%
International Affairs 54,337 422 1%
All Else 413,133 3,206 9%
Total 4,529,188 35,148 100%
2019 Revenues $Million Per
Household %
Ind. Income Taxes $1,698,353 $13,180 49%
Social Insurance Taxes 1,242,405 9,641 36%
Corporate Taxes 216,194 1,678 6%
Excise Taxes 98,669 766 3%
Customs Duties/Fees 69,469 539 2%
Fed. Reserve Earnings 48,783 379 1%
Estate/Gift Taxes 19,295 150 1%
Other Revenues 44,488 345 1%
Total Receipts 3,437,656 26,677 100%
Source: OMB Historical Tables
2.1, 2.4, 2.5, 3.2, and 8.5 Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Mandatory Spending is Squeezing Discretionary Spending
35
1965
Mandatory
(34%)Defense
(43%)
Domestic
Discretionary
(23%)
2019
Mandatory
(70%)
Defense
(15%)
Domestic
Discretionary
(15%)
Source: OMB Historical Table 8.3Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
36
Composition of Federal Spending, 1962-2019
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1962 1966 1970 1974 1978 1982 1986 1990 1994 1998 2002 2006 2010 2014 2018
Fiscal Year
Social Security & Medicare
Defense
(including wars)
Antipoverty Programs
Net Interest
Other Programs
13%
38%
49%
9%
29%
6%
20%
18%
15%
3%
Source: OMB Historical
Tables 3.2, 8.5, and 10.1 Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Social Security, Health Entitlements, & Interest Costs are Driving 92% of the 2008-2029 Spending Hikes
37
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
$7,000
2008 2011 2014 2017 2020 2023 2026 2029
Infl
ati
on
-Ad
jus
ted
(2
01
9)
$B
illi
on
s
Fiscal Year
$1,439
$3,226
$849
$596
$731
$464
$302
$721
Social Security & Health Entitlements
(up $1,787 billion)
Non-Defense Discretionary (up $73 billion)
Defense & Wars (down $10 billion)
$623 $696
Other Entitlements (up $132 billion)
Source: January 2019 CBO (current-policy)
Baseline and historical data, adjusted for inflation Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Federal Budget, 1960-2049 (Projected)
38
0%
5%
10%
15%
20%
25%
30%
1962 1972 1982 1992 2002 2012 2022 2032 2042
Perc
en
tag
e o
f G
DP
Fiscal Year
15.5%
5.7%
2.0%
2.6%
Social Security &
Health Entitlements
Defense & Wars
2.6%
Source: CBO 2019 Long-Term Budget Outlook.
Revenue
Author: Brian Riedl,
Manhattan Institute
@Brian_Riedl
Note: This is the rosy
scenario that assumes:
-- no more wars
-- no recessions
-- 2017 tax cuts expire
-- health costs slow down
-- the interest rate paid on
the national debt remains
far below average even as
the debt approaches $100
trillion.
What is Causing $80 Trillion 2019-2049 Budget Deficit?Social Security & Medicare: $103 Trillion Deficit
The Rest of the Budget: $23 Trillion Surplus
39
-$90
-$70
-$50
-$30
-$10
$10
$30
Su
rplu
s/D
efi
cit
in
No
min
al $
Tri
llio
ns
Social Security
$-28.2
$23.1
Rest of the
Federal Budget
Purple – Program Deficit
Blue – Interest Costs Directly
Attributable to Program Deficit
$-31.2
$-72.2
$-12.4
$-18.8
Medicare
$-44.0
Source of $80.4 Trillion Budget Deficit Projected over 2019-2049 Period ($Nominal)
Author: Brian Riedl,
Manhattan Institute
-- @Brian_RiedlNote: Social Security & Medicare deficits are the benefits that must
be paid from general revenues because payroll taxes, premiums,
and other non-interest trust fund revenues are insufficient. CBO
assumes full benefits will continue even after trust fund insolvency.
Source: Calculations from CBO
2019 Long-Term Budget Outlook.
To inflation adjust, trim amounts by
one-third.
Cost of 2017 Tax Cuts vs. Major Entitlements Over 30 Years
40
$7.0$18.9
$44.0
$5.5
$12.4
$28.2
$0
$10
$20
$30
$40
$50
$60
$70
$80
2017 Tax Cuts(Extended)
Social SecurityCash Deficit
MedicareCash Deficit
$N
om
inal
Tri
llio
ns
$31.2
$72.2
$12.6
Blue – Interest Costs
Purple – Principal Costs
Author: Brian Riedl,
Manhattan Institute --
@Brian_RiedlSource: Calculated using the CBO 2019 Long-Term
Budget Outlook and CBO Alternative Scenarios
2019-2049 Projected Totals
Projected 2049 Budget Deficits are Entirely Driven by Social Security & Medicare Shortfalls
41
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
Social Security & Medicare Systems Rest of the Federal Budget
Pe
rce
nta
ge
of
GD
P
5.8%
10.3%
13.7%
17.9%
Dedicated
Revenues
Revenues
Outlays
Outlays
Note: 2049 is the final year of the latest CBO 30-year budget projection.
Source: CBO 2019 Long-Term Budget Outlook.
Each outlay category includes portion of national debt interest attributed to its 2019-2049 deficits.
Author: Brian Riedl,
Manhattan Institute -
- @Brian_Riedl
42
Social Security’s Cash Shortfalls are Driven by Retiring Baby Boomer Costs and Resulting Interest Costs
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
2019 2024 2029 2034 2039 2044 2049
Pe
rce
nta
ge
of
GD
P
Fiscal Year
Social Security Revenue from Payroll Taxes & Taxation of Benefits
Social Security Outlays
7.9%
6.2%
4.9%
4.6%
4.4%
Author: Brian Riedl,
Manhattan Institute
-- @Brian_RiedlSource: Calculated using CBO 2019 Long-Term Baseline. Revenues do not include trust fund interest
transfers. Interest costs are those directly attributable to Social Security’s annual deficits over this period.
43
Medicare’s Cash Shortfalls are Driven by Soaring Benefit Costs and Resulting Interest Costs
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
2019 2024 2029 2034 2039 2044 2049
Pe
rce
nta
ge
of
GD
P
Fiscal Year
Medicare Payroll Taxes & Dedicated Revenues
Medicare Outlays
10.0%
6.0%
3.0%
1.3% 1.4%
Author: Brian Riedl,
Manhattan Institute
-- @Brian_RiedlSource: Calculated using CBO 2019 Long-Term Baseline. Outlays are net of premiums paid.
Interest costs are those directly attributable to Medicare’s annual deficits over this period.
Social Security Faces a $31 Trillion Shortfall over 30 Years - $28 Trillion if Including the Trust Fund
44
$55.9
$2.9
$74.8
$12.2
$0
$10
$20
$30
$40
$50
$60
$70
$80
$90
$100
2019-49 Revenue 2019-49 Outlays
$N
om
inal
Tri
llio
ns
$87.0
$58.8
Green = Transfers from
redeeming the Social Security
Trust Fund.
The Trust Fund contains no
economic resources and must
be redeemed by new taxes and
borrowing.
In other words, it does not
future save taxpayers a dime or
reduce the true shortfall.
Program
Outlays
Interest Costs
Payroll Taxes &
Benefit Taxes
Author: Brian Riedl,
Manhattan Institute --
@Brian_Riedl
Source: Calculated using the CBO 2019 Long-Term Budget Outlook. Interest costs reflect those
directly attributable to 2019-2049 Social Security shortfalls.
Medicare Faces a $72 Trillion Cash Shortfall Over the Next 30 years
45
$17.3
$61.2
$27.9
$0
$10
$20
$30
$40
$50
$60
$70
$80
$90
$100
2019-49 Revenue 2019-49 Outlays
$N
om
inal
Tri
llio
ns
$89.1Medicare’s $72 shortfall equals
89% of the total federal budget
deficit projected by CBO over
the 2019-2049 period.
Annual projected shortfall:
2019: 1.7% of GDP
2049: 4.6% of GDP (8.3%
including interest cost).
Program
Outlays
Interest Costs
$17.3
Payroll Taxes &
HI Trust Fund
Author: Brian Riedl,
Manhattan Institute --
@Brian_RiedlSource: Calculated using the CBO 2019 Long-Term Budget Outlook. Benefits are net of senior premiums.
Interest costs reflect those directly attributable to 2019-2049 Medicare shortfalls.
The Typical Retiring Couple Will Receive $3 in Medicare Benefits for Every $1 Paid into the System –and Also Come Out Ahead in Social Security
46
$0
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
$700,000
$800,000
Social Security Medicare
Infl
ati
on
-Ad
jus
ted
(2
01
8)
Do
lla
rs
$599,000
$498,000
$161,000
$669,000
Taxes
Paid In
Taxes Paid In
Benefits
Received
Benefits
Received
(net of
premiums
paid)
Represents typical, average-income married couple turning 65 in 2020
Calculations represent expected present values.
Source: Urban Institute (2018) Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Social Security’s Deficits Will Steeply Increase, While Medicare Also Faces Rising Deficits
47
-$450
-$400
-$350
-$300
-$250
-$200
-$150
-$100
-$50
$0
$50
2015 2017 2019 2021 2023 2025 2027 2029
No
min
al $
Bil
lio
ns
Fiscal Year
$-18
$-412
$-103
Medicare Part A (HI)
Social Security (DI)
Source: January 2019 CBO Baseline
Supplemental Trust Fund Tables.
Excludes general revenue transfers into
the programs, such as interest payments. Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Medicare and Social Security Trust Funds Face Bankruptcy in 7 and 13 Years, Respectively
48
$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
$0
$50
$100
$150
$200
$250
2015 2017 2019 2021 2023 2025 2027 2029 2031
No
min
al $
Bil
lio
ns
No
min
al $
Bil
lio
ns
Medicare Part A (HI)
Trust Fund Balance
Social Security (OASI)
Trust Fund Balance
Fiscal Year
2026 2032
Source: January 2019 CBO Baseline
Supplemental Trust Fund Tables. Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
49
Anti-Poverty Spending Has Soared Regardless of Party Control of Government
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
3.5%
4.0%
4.5%
Fe
de
ral S
pe
nd
ing
(%
GD
P)
Fiscal Year
Cash & Other Aid
Housing
Health Care
Food Aid
3.2%
(2008)
1.8%
(1980)
0.5%
(1962)
2.6%
(2000)
4.2%
(2010)3.9%
(2019)
Source: OMB Historical Tables 3.2, 8.5, and 10.1 Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
From 2001 through 2017, SNAP (Food Stamp) Caseloads Grew Nearly 7 Times as Fast as the Poverty Population
50
0%
20%
40%
60%
80%
100%
120%
140%
160%
180%
200%
Individuals in Poverty SNAP Caseloads Total Spending
Perc
en
tag
e I
ncre
ase
21%
Sources: Department of Agriculture and Census Bureau. The
poverty rate increased from 11.7% to 12.3% over this period.
144%
172%
Up 7 Million
Up
25 Million
Up
$46 Billion
(After
Inflation)
Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
In 2017, Washington Made $137 Billion in Improper Payments
51
$35
$16
$18
$32
$36
$0 $10 $20 $30 $40 $50
Other High-Risk Programs
Medicare Advantage (PartC)
Earned Income Tax Credit(EITC)
Medicare Fee-for-Service
Medicaid
2017 Improper Payments ($Billions)
Source: OMB at https://paymentaccuracy.gov/ Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Veterans’ Programs Have Earned Healthy Funding Increases
52
$0
$20
$40
$60
$80
$100
$120
$140
$160
$180
$200
2001 2010 2019
Infl
ati
on
-Ad
jus
ted
(2
01
9)
$B
illi
on
s
Fiscal Year
$126
$62
$200
Source: OMB Historical Table 3.2,
adjusted for inflation Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Why the Debt Limit Matters All 8 Major Deficit-Reduction Laws Since 1985
Were Attached to Debt Limit Legislation
53
Year Major Deficit-Reduction Law Attached to
Debt Limit?
1985 Gramm-Rudman-Hollings Deficit Caps
1987 Gramm-Rudman-Hollings Deficit Caps II
1990 Bush Tax Increases & Spending Caps
1993 Clinton Deficit Reduction Package
1996 Line-Item Veto Act (later struck down by Supreme Court)
1997 Balanced Budget Act
2009 Statutory Pay-As-You-Go Act
2011 Budget Control Act (Cutting $2.1 Trillion)
Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Source: Compiled by the Committee
For a Responsible Federal Budget
Federal Budget, 1960-2049 (Projected)
55
0%
5%
10%
15%
20%
25%
30%
1962 1972 1982 1992 2002 2012 2022 2032 2042
Perc
en
tag
e o
f G
DP
Fiscal Year
15.5%
5.7%
2.0%
2.6%
Social Security &
Health Entitlements
Defense & Wars
2.6%
Source: CBO 2019 Long-Term Budget Outlook.
Revenue
Author: Brian Riedl,
Manhattan Institute
@Brian_Riedl
Note: This is the rosy
scenario that assumes:
-- no more wars
-- no recessions
-- 2017 tax cuts expire
-- health costs slow down
-- the interest rate paid on
the national debt remains
far below average even as
the debt approaches $100
trillion.
No “Easy” Pay-Fors for Social Security & Medicare:Programs Face Shortfalls of 6% of GDP by 2040s
56
Author: Brian Riedl,
Manhattan Institute
@Brian_Riedl
Tax Proposals (static scoring) 10-Yr Savings
($Billions)
Long-Term Savings
(%GDP)
Raise Payroll Tax by 10 Percentage Points, no wage limit $8,982 3.60%
Impose a 20% Value-Added Tax (VAT) – like a national sales tax $7,680 3.35%
Raise Income Tax Rates Across-the-Board by 10 Percentage Points $9,054 3.30%
Double 35% and 37% Tax Brackets to 70% and 74% (plus 15% state/payroll)* $4,504 1.70%
Repeal All Itemized Tax Deductions $1,312 0.99%
Raise Corporate Tax Rate by 20 Percentage Points $1,926 0.87%
Eliminate FICA Cap – 15.3% Payroll Tax on All Wages (data from SSA) $1,959 0.85%
Repeal Entire 2017 Tax Law (CurPol baseline) (data from CBO/JCT) $1,712 0.70%
Carbon Tax of $25/Metric Ton – no rebate for households hit $1,099 0.43%
Impose a Tax on Financial Transactions $777 0.37%
Tax Dividends & Long-Term Capital Gains as Ordinary Income $593 0.23%
Impose "Bank Tax" on Large Financial Institutions $103 0.03%
30% Minimum "Buffett Tax" for Millionaires $66 0.03%
Tax Carried Interest as Ordinary Income $14 0.01%
Spending Proposals
Cut Defense Budget to European Levels (data from CBO baseline) $2,628 1.00%
Sanders Medicare-For-All Proposal (per Urban Institute, Mercatus, and Emory U.) Adds Costs
Source: Dec. 2018 CBO “Budget Options” book unless otherwise noted.
These static estimates do not account for revenues lost to the economic impact. Combining policies
may also create interaction effects or duplicate the same policies, so these cannot be summed.
Defense is Not Driving the Deficit – and Even Eliminating It Completely Would Not Come Close to Financing Soaring
Long-Term Entitlement Costs
57
0%
2%
4%
6%
8%
10%
12%
14%
16%
1970 1980 1990 2000 2010 2020 2030 2040
Fed
era
l S
pen
din
g (
%G
DP
)
Fiscal Year
Defense
Social Security and Health Entitlements
Author: Brian Riedl,
Manhattan Institute --
@Brian_Riedl
Source: OMB Historical Tables 3.2, and 10.1;
and CBO 2019 Long-Term Outlook.
Even 100% Tax Rates on Small Businesses and Upper-Income Families Could Not Come Close to
Balancing the Long-Term Budget
58
4.2%
7.1%
9.8%
12.9%
3.4%
4.7%
0%
2%
4%
6%
8%
10%
12%
14%
2019 2029 2039 2049 $1 million $500,000
Pe
rce
nta
ge
of
GD
P
----- Projected Budget Deficit -----
All untaxed personal &
small business adjusted
gross income (AGI)
annually earned above the
listed income threshold
Source: CBO 2019 Long-Term Budget Outlook adjusted into current-policy
baseline and analysis of IRS 2017 (latest year) income tables
Author: Brian Riedl,
Manhattan Institute
-- @Brian_Riedl
“Tax-the-Rich” Policies Could Finance Less than $4 Trillion of the $40 Trillion in Promised Spending
59
Author: Brian Riedl,
Manhattan Institute
@Brian_Riedl
Notes:
• Amounts are in $billions over ten years.
• CBO estimates typically exclude economic effects, which become larger the higher the tax rises.
• The payroll tax hike would raise highest marginal tax rate (federal + state + payroll) to as high as
60%, which is approximately the revenue-maximizing level.
• Adding the 70% tax rate over $10 million produces a combined marginal tax rate over 90%.
Tax Set at Revenue-Maximizing Level Rosy
Revenues
Realistic
Revenues
Source: Rosy/ Realistic
70% Income Tax Rate over $10 Million $292 $189 Tax Foundation
Eliminate FICA Cap – 15.3% Payroll Tax
on All Wages$1,959 $1,763 CBO / CBO-10% Feedback Loss
Tax Dividends & Long-Term Cap. Gains as
Ordinary Income$593 $398 CBO / CBO-33% Feedback Loss
Sen. Warren Wealth Tax of 2% to 3% $2,750 $368 Campaign / Lawrence Summers et. al
Sen. Sanders Estate Tax of 77% $315 $211 Campaign / Campaign-33% Tax Avoidance
Sen. Warren Corp. Tax Increase $872 $476 Tax Foundation
Financial Transactions Tax of 0.1% $777 $208 CBO / Tax Policy Center Economists
Bank Tax of 0.15% $103 $103 CBO
Tax Carried Interest as Ordinary Income $14 $14 CBO
Total $7,675 $3,730
Democratic Presidential Spending Proposals Would Cost Between $37 Trillion & $72 Trillion Over the Decade
60
Author: Brian Riedl,
Manhattan Institute
@Brian_Riedl
*All figures are over ten years, and in $trillions.
**Absurdly-low jobs guarantee score assumes only 9.7 million people sign up, even though generous
proposal would provide a higher income for roughly 70 million Americans.
Common Presidential Spending Proposal Low* High* Notes
Medicare-For-All $32.0 $40.0 Sanders recently conceded this cost range
Climate and Clean Energy $2.0 $16.3 Sanders is the high figure
Government Job Guarantee — $6.8 Sanders proposal, scored by CBPP**
Free Public College Tuition & Loan Forgiveness $1.5 $3.0 Low figure reflects partial loan forgiveness
Social Security Expansion $0.5 $2.0 Warren & Sanders are the high figure
Affordable Housing $0.1 $2.0 Sanders is the high figure
Infrastructure Buildup $1.0 $1.0
Universal Child Care & Paid Family/Medical Leave $0.3 $1.0
Teacher Pay and K-12 funding $0.1 $0.5
Subtotal: New Spending Proposals $37.5 $72.6 Baseline is $60 trillion spending over 2020-2029
CBO Baseline Budget Deficit $15.5 $15.5 CBO (current policy) baseline, 2020-2029
Total Federal Budget Deficit $53.0 $88.1 Out of a $262 trillion projected GDP (CBO)
Popular Spending Offsets
Cut Defense to European Levels -$2.6 -$2.6 Baseline is 3% of GDP. NATO target is 2%
Medicare-For-All - Capture State Govt Savings -$3.0 -$3.0 It is not clear Washington could capture this
Remaining Budget Shortfall To Fill $47.4 $82.5 Requires > Doubling $44T in Federal Revenues
Popular Campaign Promises Would Bring $57 Trillion Shortfall – Which Taxing the Rich Cannot Close
$0
$10
$20
$30
$40
$50
$60
Budget Gap Maximum "Tax theRich" Revenues
$N
om
inal
Tri
llio
ns o
ver
10 Y
ears
$3.7
$57.5*Other proposals consist of:
- Climate spending ($2T)
- Student loan relief & free college ($3T)
- Social Security expansion ($2T)
- Infrastructure, housing, family leave,
child care, K-12, and other ($2T)
Note: Sen. Sanders would spend an
additional $25T on a larger Medicare-For-
All plan, climate plan, and government job
guarantee.
Other Proposals
($10*)
Baseline Deficit
($15.5)
Medicare-For-All
($32)
Author: Brian Riedl,
Manhattan Institute
@Brian_Riedl
Source: January 2019 CBO (current-policy) budget
baseline, and proposal scores based on data from
CBO, Urban Institute, Tax Foundation, Tax Policy
Center, and the campaigns themselves.
620%
5%
10%
15%
20%
25%
All UntaxedIncome Over $1
Million
Entire DefenseBudget
Baseline Deficit(30-yr)
Proposed NewSpending
Perc
en
tag
e o
f G
DP
4.7%
8.3%
25.6%
3.0%
Medicare-For-All
(13.7%)
Climate (Sanders)
(6.2%)
Job Guarantee
(2.6%)
Other Proposals (1.9%)Free College & Loan Forgiveness (1.1%)
Author: Brian Riedl,
Manhattan Institute
-- @Brian_Riedl
No, Defense Cuts & Taxing Millionaires Cannot Finance Current Deficit or Liberal Wishlist
Sources: Author calculations using data from CBO, Treasury, liberal candidates, and liberal think tanks
Common Tax Hike Proposals Would Close Just 2% of the Budget Deficit – or Lose Revenue if They Trim
Economic Growth Rates by Even 0.1%
63
$15,494
$263 -$29
-$2,000
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
$16,000
Baseline 10-Yr BudgetDeficit
Cumulative TaxIncreases
Dynamic Score if AnnualEconomic Growth Falls
From 1.8% to 1.7%
No
min
al $
Bil
lio
ns
Combined Tax Increase*
1) Raise capital gains & dividend tax rates by 5%
2) Buffett tax
3) Repeal oil and gas tax breaks
4) Tax carried interest as ordinary income
Combined Tax Increase Revenue
Source: CBO January 2019 (current-policy) Baseline, and tax proposals scored by CBO.
OMB estimates that a 0.1% fall in annual economic growth costs the federal government
$292 billion in revenues over the decade.
Author: Brian Riedl,
Manhattan Institute --
@Brian_Riedl
64
$13,970 $12,552$13,248
$21,078
$5,371 $7,973
$13,248
$14,203
$0
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
$40,000
Colorado Plan(failed referendum)
Vermont Plan(abandoned)
California Plan(abandoned)
Bernie SandersNational Plan
Ave
rag
e A
nn
ua
l C
os
t P
er-
Ho
us
eh
old
$20,524
$35,280
$26,497
$19,340
New Spending & Taxes
Redirect Existing Govt. Funds
Source: Public scores of Vermont and California bills, and Colorado Health
Institute data. Sanders calculated from Urban Institute 2016 score of plan
Author: Brian Riedl,
Manhattan Institute
@Brian_Riedl
Single-Payer Health Plans Do Not Save MoneyThey Would Require Huge Per-Household
Tax Increases
Rising Spending – Not Falling Revenues –Drives the Long-Term Deficit
66
0%
5%
10%
15%
20%
25%
30%
35%
1962 1972 1982 1992 2002 2012 2022 2032 2042
Pe
rce
nta
ge
of
GD
P
Fiscal Year
20.0%
(1960-2018)
17.4%
(1960-2018)
Federal Spending
Tax Revenues
30.8%
(2049)
18.1%
(2049)
Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Source: CBO 2019 Long-Term Budget Outlook,
adjusted into current-policy baseline
Income Tax Revenues Have Remained Relatively Constant Regardless of the Top Tax Rate
67
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
11%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1934 1944 1954 1964 1974 1984 1994 2004 2014
Top Income Tax Rate Income Tax Revenues (%GDP)
Fiscal Year
Average Top Rate / Revenues
1950s: 90.5% / 7.2%
1960s: 80.3% / 7.6%
1970s: 70.2% / 7.9%
1980s: 48.4% / 8.2%
1990s: 36.7% / 8.1%
2000s: 36.2% / 7.8%
2010s: 37.7% / 7.8%
Correlation
1950-2019:
-0.19
Source: OMB Historical Table 2.3, and
U.S. Treasury SOI Tax Stats – Historical Table 23 Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Individual Income Tax Revenues Will Rise – Even With the Tax Cuts – Due to Real Bracket Creep
& Taxable Retirement Distributions
6%
7%
8%
9%
10%
1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025
Ind
ivid
ua
l In
co
me
Ta
x R
eve
nu
es
(%
GD
P)
Fiscal Year
Tech Bubble
& Burst
Deep
Recession
Reagan
Tax Cuts
Bracket Creep
Deep
Recession
CBO Baseline with
(Tax Cuts Extended)
68Source: OMB Historical Table 2.3, and January 2019 CBO (current-policy) Baseline. Real bracket creep is
when rising incomes (above inflation) push taxpayers into higher tax brackets, raising their average tax rate.
Author: Brian Riedl,
Manhattan Institute --
@Brian_Riedl
High Capital Gains Tax Rates Have Not Produced More Revenue
69
0.0%
0.2%
0.4%
0.6%
0.8%
1.0%
1.2%
1.4%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
1954 1960 1966 1972 1978 1984 1990 1996 2002 2008 2014
Top Capital Gains Tax Rate Capital Gains Tax Revenues (%GDP)
Fiscal Year
Correlation: -0.31
Source: Tax Tables, U.S. Treasury Office of Tax Analysis.Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Before the TCJA Cut it to 26% (incl. 5% State Taxes)U.S. had the Highest Corporate Tax Rate in the OECD
70
39%
32%32%
30%30%30%
30%30%
28%
28%
28%28%
27%26%
25%
25%
25%
25%
25%23%
22%
22%
22%
21%
21%
21%
20%20%
20%
20%
19%19%
19%19%
15%
13%
9%
0%
10%
20%
30%
40%
Un
ite
d S
tate
s -
201
7
Fra
nc
e
Po
rtu
ga
l
Au
str
alia
Me
xic
o
Ge
rma
ny
Jap
an
Be
lgiu
m
Gre
ec
e
Ne
w Z
ea
lan
d
Ita
ly
Ko
rea
Ca
na
da
Un
ite
d S
tate
s -
201
9
Au
str
ia
Ch
ile
Ne
the
rla
nd
s
Sp
ain
Lu
xem
bo
urg
Isra
el
De
nm
ark
No
rwa
y
Tu
rke
y
Sw
ed
en
Sw
itze
rla
nd
Slo
va
k R
ep
ub
lic
Es
ton
ia
Fin
lan
d
Icela
nd
Latv
ia
Cze
ch
Rep
ub
lic
Po
lan
d
Slo
ve
nia
Un
ite
d K
ing
do
m
Lit
hu
an
ia
Ire
lan
d
Hu
ng
ary
To
p C
orp
ora
te T
ax
Ra
te
Source: OECD Stats (2019), Tax Table II.1. Tax rates
include federal, state, province and local corporate taxes.
Notes: While all countries allow businesses to reduce their taxes through
exemptions, deductions, and credits, the U.S. has been among the highest
effective corporate tax rates too.Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
The U.S. has Finally Caught Up With the Rest of the OECD on Corporate Tax Competitiveness
71
32%31% 30%
30%29%
28%27%26% 25% 25%25% 25% 25% 25% 25% 25% 24% 24% 24% 24%
0%
5%
10%
15%
20%
25%
30%
35%
40%2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
To
p C
orp
ora
te T
ax R
ate
United States – 39%
Average of Other
34 OCED Nations
26%
Source: OECD Stats (2019), Tax Table II.1. Tax rates
include federal, state, province and local corporate taxes. Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
The Economy Matters More: President Obama Oversaw $500 Billion in New Taxes –and Also Lost $3.2 Trillion to Economic Downgrades
72
-$822
$1,328
-$3,153-$3,500
-$3,000
-$2,500
-$2,000
-$1,500
-$1,000
-$500
$0
$500
$1,000
$1,500
No
min
al $
Bil
lio
ns
Added Revenue from
Tax Hikes
Lost Revenue from
Economic
Downgrades and
Technical
Re-estimates
Lost Revenue from
Tax Cuts
Figures reflect 2009-2019 estimates, as of
January 2017 when Pres. Obama left office
Source: Congressional Budget Office data. Between January 2009 and January 2017, Congress and President Obama enacted legislation
adding $516 billion to 2009-2019 revenues (against a current-policy baseline). During that same period, the unexpectedly-weak economic
recovery and related technical estimates reduced 2009-19 revenues by $3,153 billion. Note that the initial January 2009 CBO baseline had
already incorporated the projected 2009-19 revenue losses from the recession. These additional economic downgrades reflect the weak
recovery, particularly in the later years. Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Taxes Cannot Easily Close Security & Medicare Shortfall:Will Need General Revenues of 6% of GDP by 2040s
73
Author: Brian Riedl,
Manhattan Institute
@Brian_Riedl
Tax Proposals (static scoring) 10-Yr Savings
($Billions)
Long-Term Savings
(%GDP)
Raise Payroll Tax by 10 Percentage Points, no wage limit $8,982 3.60%
Impose a 20% Value-Added Tax (VAT) – like a national sales tax $7,680 3.35%
Raise Income Tax Rates Across-the-Board by 10 Percentage Points $9,054 3.30%
Double 35% and 37% Tax Brackets to 70% and 74% (plus 15% state/payroll)* $4,504 1.70%
Repeal All Itemized Tax Deductions $1,312 0.99%
Raise Corporate Tax Rate by 20 Percentage Points $1,926 0.87%
Eliminate FICA Cap – 15.3% Payroll Tax on All Wages (data from SSA) $1,959 0.85%
Repeal Entire 2017 Tax Law (CurPol baseline) (data from CBO/JCT) $1,712 0.70%
Carbon Tax of $25/Metric Ton – no rebate for households hit $1,099 0.43%
Impose a Tax on Financial Transactions $777 0.37%
Tax Dividends & Long-Term Capital Gains as Ordinary Income $593 0.23%
Impose "Bank Tax" on Large Financial Institutions $103 0.03%
30% Minimum "Buffett Tax" for Millionaires $66 0.03%
Tax Carried Interest as Ordinary Income $14 0.01%
Source: Dec. 2018 CBO “Budget Options” book unless otherwise noted.
These static estimates do not account for revenues lost to the economic impact. Combining policies
may also create interaction effects or duplicate the same policies, so these cannot be summed.
The Federal Tax Code Remains Progressive
1.0%
-4.7%
-0.6%
4.5%
8.6%11.3%
13.4%15.9%
18.8%21.5%
22.9%
27.3%
31.1%
-8.7%
-13.2%
-9.7%
-4.9%-1.1%
1.7%
3.6% 5.6%
8.2%10.8%
14.0%
20.6% 23.1%
-20%
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
35%
0-10$5k
10-20$17k
20-30$25k
30-40$34k
40-50$45k
50-60$60k
60-70$79k
70-80$105k
80-90$145k
90-95$204k
95-99$344k
99-99.9$1006k
Top.1%$8M
20
19
Ave
rag
e T
ax
Ra
te
Income Distribution Range and Average Family Cash Income
Average Tax Rate Paid For Federal Income Taxes
Average Tax Rate Paid for All Federal Taxes
Source: U.S. Treasury, Office of Tax Analysis.
Data represents 2019 Distribution of Tax Burden, Current Law
Author: Brian Riedl,
Manhattan Institute -
- @Brian_Riedl
Average Federal Tax Rate Paid by Income Category, 1979-2013
76
0%
5%
10%
15%
20%
25%
30%
35%
40%
1979 1982 1985 1988 1991 1994 1997 2000 2003 2006 2009 2012
Ave
rag
e F
ed
era
l Ta
x R
ate
Pa
id
Fiscal Year
27%
19%
26%
17%
15%
8%
22%
3%
8%
Second 20%
13%
Bottom 20%
Fourth 20%
Middle 20%
Top 20%
34%
Top 1%35%
Note: Includes federal income, payroll,
corporate, and excise taxes paid.
Source: CBO "Distribution of Household
Income and Federal Taxes“ (2016) Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
The Federal Tax Burden (For All Combined Taxes) Has Grown More Progressive Over Time
77
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1979 1982 1985 1988 1991 1994 1997 2000 2003 2006 2009 2012
Pe
rce
nta
ge
of
Fe
de
ral Ta
x B
urd
en
P
aid
by Q
uin
tile
Fiscal Year
55%
14%
69%
17%
7%2%
22%
1%
4%
Second 20%
9%
Bottom 20%
Fourth 20%
Middle 20%
Top 20%
Percentage of Federal Tax Burden Financed by Income Quintile
Source: CBO "Distribution of Household
Income and Federal Taxes” (2016) Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
The Highest-Earning 20 Percent of Taxpayers Pay 88 Percent of All Federal Individual Income Taxes
78
-10%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1979 1982 1985 1988 1991 1994 1997 2000 2003 2006 2009 2012
Pe
rce
nta
ge
of
Inc
om
e T
ax
Bu
rde
n
Pa
id b
y Q
uin
tile
Fiscal Year
65%
11%
88%
13%
4%
0%
20%
-4%
-1%
Second 20%
4%
Bottom 20%
Fourth 20%
Middle 20%
Top 20%
Percentage of Federal Income Tax Burden Financed by Income Quintile
Source: CBO "Distribution of Household
Income and Federal Taxes“ (2016) Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Even Controlling for Income Inequality, Income Taxes Have Become More Progressive, With the Highest-Earning 20
Percent Increasing Their Income Tax Share
-2
-1
0
1
2
3
1979 1982 1985 1988 1991 1994 1997 2000 2003 2006 2009 2012
Ra
tio
of
the
Sh
are
of
Inc
om
e T
ax
es
P
aid
Div
ide
d b
y t
he
Sh
are
of
Inc
om
e
Ea
rne
d
Fiscal Year
1.45
0.68
1.67
0.66
0.37
0.00
0.92
-0.78
-0.13
Second 20%
0.28
Bottom 20%Fourth 20%
Middle 20%
Top 20%
Top 1%2.07 2.55
79Source: Calculations using CBO "Distribution of
Household Income and Federal Taxes” (2016)
“Progressivity ratio” refers to the share of all individual income taxes paid divided by the share of pre-tax income earned. So a group that pays
40% of the taxes while earning 20% of the income has a progressivity ratio of 2. Ratios above 1 represent tax burdens exceeding their share
of the income, while ratios below 1 represent tax burdens below their income share. Negative figures reflect a negative tax burden.
Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Progressivity Ratio by Income Rank
0.800.84
0.900.940.95
1.001.011.02
1.071.101.101.11
1.141.15
1.171.171.181.191.201.20
1.221.26
1.281.29
1.35
0.5 0.6 0.7 0.8 0.9 1.0 1.1 1.2 1.3 1.4 1.5
SwitzerlandPolandIceland
BelgiumNorwaySweden
JapanDenmarkGermany
AustriaFrance
OECD-24Slovak Republic
LuxembourgCzech Republic
KoreaItaly
New ZealandUnited Kingdom
FinlandCanadaIreland
NetherlandsAustralia
United States
Progressivity Ratio
Note: For the highest-earning
10% of taxpayers, these figures
refer to their share of the nation’s
taxes paid, divided by their share
of the nation’s pre-tax income
earned.
So if the top decile pays 30% of
the taxes and earns 20% of the
income, its ratio is 1.5.
Even Controlling for Income Inequality, the U.S. Has the Most Progressive Income/Payroll Tax Code in the OECD
80
Source: OECD (2008) and Tax Foundation. The U.S tax code has since
become even more progressive. Figures also exclude value-added taxes
that make many other OECD nations’ tax codes even less progressive.Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
The Reagan Tax Cuts Did Not Starve the Government –Spending Worsened the 1980s Deficits
82
16.8%
17.3% 17.4%17.8%
17.2%
18.1%
19.4%
21.6%
15%
16%
17%
18%
19%
20%
21%
22%
1950s 1960s 1970s 1980s
Pe
rce
nta
ge
of
GD
P
Purple = Spending
Taxes
Paid In
Red = Revenues
Source: OMB Historical Table 1.3 Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Why Did 1980s Budget Deficits Exceed the 1970s Deficits?
83
5.7%
4.3% 4.4%
3.6%
1.4%
5.6%
4.0%
5.8%
3.6%
2.7%
0%
1%
2%
3%
4%
5%
6%
Fe
de
ral S
pe
nd
ing
(P
erc
en
tag
e o
f G
DP
)
Fell during
1970s,
rose back
during 1980s
1970s
1980s increase:
60% - added debt
40% - higher
interest rates
1970s1970s1970s 1970s 1980s1980s1980s1980s 1980s
Source: OMB Historical Table 8.4, and interest rate calculations
using the Economic Report of the President Table B-25.
Author: Brian Riedl,
Manhattan Institute -
@Brian_Riedl
Non-Defense
Discretionary
Other
Entitlement
Programs
Defense Social
Security &
Medicare
Interest on
Debt
1970s Average Percentage of GDP: Revenue 17.4%, Spending 19.4%, Deficit: 2.0%
1980s Average Percentage of GDP: Revenue 17.8%, Spending 21.6%, Deficit: 3.8%
To the Extent it Contributed to the Soviet Collapse,the 1980s Defense Buildup Eventually Paid for Itself
84
0%
1%
2%
3%
4%
5%
6%
7%
1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000
De
fen
se
Sp
en
din
g (
%G
DP
)
Fiscal Year
Initial 1980 Baseline of 4.8% of GDP
1992-2001 Post-Cold War Wind Down:
Average of 3.5% of GDP
(1.3% below 1980 baseline)
1981-1991 Cold War Buildup:
Average of 5.5% of GDP
(0.7% above 1980 Baseline)
Author: Brian Riedl,
Manhattan Institute
-- @Brian_Riedl
Source: OMB
Historical Tables
3.2, and 10.1
Note: Some believe that America’s 1980s defense buildup pushed the
Soviets into an unaffordable arms race that contributed to its economic
problems and ultimately a more accommodating posture towards the West,
each of which contributed to Soviet destabilization and collapse.
The 1990s Budget Was Balanced by an Economic Boom and the Cold War Peace Dividend
(and by Washington Not Spending All the Savings)
0.7%
2.2%
-1.7%
-0.9%
-0.4% -0.4% -0.5%
-2%
-1%
0%
1%
2%
3%
Ch
an
ge
in
Pe
rce
nta
ge
of
GD
P
Change Between 1992 Peak Deficit of 4.5% of GDP,and 2000 Peak Surplus of 2.3% of GDP
Revenues Jumped 2.9% of GDP Spending Fell 3.9% of GDP
Defense
cuts after
Cold War
ends
Interest
savings
Reduced
unemployment
costs
Grew faster than
Social Security
benefits
Strong Economy
Various
small
savings1993 Clinton
tax hike
Economic
growth &
small tax
changes
85Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
Source: OMB Historical Tables 2.3, 3.2, and 10.1;
and the CBO (1993) score of tax increases
The May 2003 Supply-Side Tax Rate Cuts Were More Successful Than They are Credited For
86
-2%
-1%
0%
1%
2%
3%
4%
5%
6%
7%
-10%
-5%
0%
5%
10%
15%
2001 2002 2003 2004 2005 2006
Business Investment
Growth
Real GDP
Growth
Source: BEA, BLS, S&P. The 2003 tax cuts reduced marginal tax rates for families, small
businesses, & investors. The less-successful 2001 tax cuts were more rebate-based.
The 2007 housing crash that ended this mini-boom was unrelated to these tax policies.
Author: Brian Riedl,
Manhattan Institute
@Brian_Riedl
93.0%
93.5%
94.0%
94.5%
95.0%
95.5%
96.0%
800
900
1,000
1,100
1,200
1,300
1,400
2001 2002 2003 2004 2005 2006
S&P 500Employment (and
Unemployment) Rate
May
/ 5.0%
/ 4.0%
/ 4.5%
/ 6.0%
/ 5.5%
/ 6.5%
/ 7.0%
May
The “Bush Tax Cuts” for Upper-Income Taxpayers Caused Only 7% of the 2001-2011 Fiscal Decline Under President Bush
87
Economic & Technical Downgrades, 32%
"Bush Tax Cuts" -Earners Over $250k,
7%
"Bush Tax Cuts" -Earners Under
$250k, 16%
2008 Economic Stimulus Act, 2%
Other Tax Policies, 5%
Defense Spending, 21%
Non-Defense Discretionary Spending, 8%
Other Entitlement Reforms, 4%
Medicare Prescription Drug Program, 3%
TARP, 2%
Note: When President Bush
took office, CBO forecast a
$5.9 trillion surplus over the
FY 2001-2011 period.
When he left office in
January 2009, CBO was
showing a $4.4 trillion deficit
over that same decade.
This chart accounts for the
$10.3 trillion fiscal decline.
Green – Tax Legislation
Blue – Spending Legislation
Red – Non-Legislative
Author: Brian Riedl,
Manhattan Institute
@Brian_Riedl
Source: Calculations based on a CBO June 2012 report, and CBO baseline updates over
2001-11 period. Tax distribution data was estimated using Treasury data accumulated by the
Tax Policy Center. Each category’s cost includes its resulting net interest expenses.
President Bush Oversaw a $10.3 Trillion Decline from the Inherited 2001-2011 Budget Projections
(All numbers in nominal $billions) 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2001-2011
CBO January 2001 Projected Surplus 281 313 359 397 433 505 573 635 710 796 889 5,891
Legislative Changes
"Bush Tax Cuts" - Earners Over $250k -22 -12 -48 -82 -74 -71 -72 -78 -81 -88 -71 -699
"Bush Tax Cuts" - Earners Under $250k -52 -27 -112 -191 -172 -165 -169 -181 -189 -206 -167 -1,631
Defense Spending -5 -36 -85 -130 -165 -195 -229 -294 -332 -343 -357 -2,171
Non-Defense Discretionary Spending 2 -17 -34 -46 -74 -91 -83 -107 -120 -118 -114 -802
AMT Patch, Tax Extenders, Other Tax Changes -1 -44 -44 -33 -12 -12 -55 -89 -129 -42 -30 -489
Medicare Prescription Drug Program 0 0 0 -4 -6 -29 -44 -50 -56 -62 -70 -321
TARP Financial Bailouts 0 0 0 0 0 0 0 0 -194 -16 -12 -221
Economic Stimulus Act of 2008 0 0 0 0 0 0 0 -160 -25 3 0 -181
Other Entitlement Reforms -8 -14 -36 -29 -36 -51 -44 -41 -74 -52 -46 -432
Economic & Technical Re-estimates
Economic/Technical Downgrades -67 -319 -377 -295 -212 -140 -39 -95 -696 -577 -520 -3,337
CBO January 2009 Budget Surplus/Deficit 128 -158 -378 -413 -318 -248 -161 -459 -1,186 -703 -498 -4,394
Memorandum
Legislative Changes -87 -150 -358 -514 -540 -614 -696 -1,000 -1,199 -923 -867 -6,947
Economic & Technical Re-estimates -67 -319 -377 -295 -212 -140 -39 -95 -696 -577 -520 -3,337
Total Deficit Changes -154 -469 -735 -809 -752 -754 -735 -1,095 -1,895 -1,500 -1,386 -10,285
Revenue Changes -144 -383 -561 -573 -416 -282 -248 -431 -750 -738 -622 -5,148
Spending Changes -10 -88 -176 -237 -335 -471 -486 -663 -1,147 -761 -765 -5,138
88
Source: Author calculations based on a CBO June 2012 report, and CBO baseline updates over 2001-11 period. Positive
numbers add to deficit, negative numbers reduce deficit. Legislative changes include associated interest costs and
savings. Ending 2090-2011 figures represent estimates on January 2009 when President Bush left office.
See “Obama's Fiscal Legacy: A Comprehensive Overview of Spending, Taxes, and Deficits,” by Brian Riedl.
Author: Brian Riedl,
Manhattan Institute
@Brian_Riedl
President Obama Oversaw 2009-2019 Budget Deficits $4.6 Trillion Beyond the Inherited Baseline
-$1,600
-$1,400
-$1,200
-$1,000
-$800
-$600
-$400
-$200
$0
2006 2008 2010 2012 2014 2016 2018
No
min
al
$B
illi
on
s
Fiscal Year
Actual Budget Deficits
CBO Baseline Deficit, January 2009
Note: The January 2009 CBO
baseline already incorporated the
10-year effects of the 2007-2009
recession, and the policies
inherited from President Bush.
The added Obama deficits consist
of $5 trillion in new legislation,
partially offset by $400 billion saved
by the sluggish recovery, as lower
interest rates and thus interest
costs offset the lower revenues
90
Source: CBO data. FY 2017-2019 "actuals" reflect CBO baseline as of January 2017, and thus reflect the
deterioration of the full ten-year budget picture.
See “Obama's Fiscal Legacy: A Comprehensive Overview of Spending, Taxes, and Deficits,” by Brian Riedl.
Author: Brian Riedl,
Manhattan Institute
@Brian_Riedl
Under President Obama, the 2009-2019 Deficit Worsened by $4.6 Trillion Relative to the Inherited
January 2009-19 Baseline
91
-$4,988
-$3,153
$397$820
$2,314
-$5,000
-$4,000
-$3,000
-$2,000
-$1,000
$0
$1,000
$2,000
$3,000
No
min
al $
Bil
lio
ns
2009-2019 Deficit Impact
Revenue
Downgrades
(Weak Recovery
& Technical
Re-estimates)
Automatic
Entitlement
Savings Due to
Weak Economy
& Technical
Re-estimates
New
Legislation
Signed by
President
Obama
Automatic
Interest Savings
Due Mostly to
Falling Interest
Rates from Weak
Recovery
Faster Recovery
of Financial
Bailout Costs
Purple = Deficit changes unrelated to 2009-17 legislation.
Sum to $378 billion in deficit reduction
Source: Author calculations based on CBO baseline updates and bill scores. Positive figures reduce the deficit, negative figures worsen
the deficit. The January 2009 baseline already incorporated the long-term effects of the recession. Subsequent economic downgrades
reflect the unexpectedly-weak recovery after the recession ended. See “Obama's Fiscal Legacy: A Comprehensive Overview of
Spending, Taxes, and Deficits,” by Brian Riedl.Author: Brian Riedl, Manhattan Institute -- @Brian_Riedl
President Obama Oversaw a $4.6 Trillion Decline from the Inherited 2009-2019 Budget Projections
92
Source: “Obama's Fiscal Legacy: A Comprehensive Overview of Spending, Taxes, and Deficits,” by Brian Riedl (based on CBO data).
Positive numbers add to deficit, negative numbers reduce deficit. Legislative changes include associated interest costs and savings. Ending
2017-2019 figures represent estimates as of January 2017 when President Obama left office.
Author: Brian Riedl,
Manhattan Institute
@Brian_Riedl
(All numbers in nominal $billions) 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2009-19
CBO January 2009 Baseline Budget Deficit -1,186 -703 -498 -264 -257 -250 -234 -272 -234 -188 -235 -4,321
Legislative Changes
Renewing Pre-2009 Tax Policies -27 -114 -239 -273 -382 -363 -421 -528 -539 -596 -654 -4,135
2009 ARRA Stimulus -163 -311 -175 -63 -58 -55 -39 -29 -33 -39 -46 -1,010
Subsequent Stimulus and Recession Relief -7 -106 -233 -269 -93 -15 -17 -41 -44 -56 -67 -948
Renewing Pre-2009 Health Laws 0 -3 -16 -20 -19 -15 -16 -19 -19 -15 -12 -154
Other Mandatory Spending Legislation -7 -7 -16 -25 -29 -13 1 -1 4 12 13 -69
Hurricane Sandy Relief 0 0 0 0 -5 -13 -12 -11 -10 -7 -6 -64
BCA Mandatory Sequesters 0 0 0 0 10 14 16 16 18 20 22 117
Affordable Care Act 0 -7 -2 19 44 51 51 30 17 30 41 275
Other Revenue Legislation 4 18 -4 21 7 35 27 56 37 39 41 282
Other Discretionary Spending and OCO Reforms -18 -49 -84 -59 36 89 124 144 150 183 202 718
Economic and Technical Re-estimates
Revenue Effect - Economic Changes -33 27 3 -17 -180 -197 -256 -329 -287 -299 -352 -1,920
Revenue Effect - Techncial Re-estimates -159 -178 -118 -254 -54 -125 -7 -33 -121 -92 -93 -1,233
Financial Bailout Cost Re-Estimates -1 126 5 -28 113 89 33 25 26 7 0 397
Mandatory Spending - Economic/Technical Re-estimates 176 10 65 30 -23 24 1 71 125 151 190 820
Interest Spending - Economic/Technical Re-estimates 8 1 12 113 210 261 309 332 350 363 356 2,314
Actual Deficits and January 2017 Baseline Deficit -1,413 -1,294 -1,300 -1,087 -680 -485 -438 -587 -559 -487 -601 -8,931
Memorandum
Total Legislative Changes -219 -577 -768 -668 -488 -286 -286 -382 -418 -429 -467 -4,988
Total Economic and Technical Re-estimates -8 -14 -33 -155 66 51 81 67 93 130 101 378
Total Deficit Changes -227 -592 -801 -823 -423 -235 -205 -315 -325 -299 -366 -4,610
Tax Revenue Impact of CBO Economic Growth Downgrades (and Upgrades) Under President Obama
93
-$33
$27$3
-$17
-$180-$197
-$256
-$329
-$287 -$299
-$352-$400
-$300
-$200
-$100
$0
$100
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
No
min
al
$B
illi
on
s
Fiscal Year
Source: CBO budget baselines between March 2009 and January 2017. See “Obama's Fiscal
Legacy: A Comprehensive Overview of Spending, Taxes, and Deficits,” by Brian Riedl.
Note: Consists of gained/lost revenues specifically resulting from
economic growth upgrades and downgrades between March 2009 and
January 2017. Post-2016 figures reflect latest estimates.
Author: Brian Riedl,
Manhattan Institute
@Brian_Riedl
CBO Economic Downgrades Under President Obama Have Sharply Lowered Interest Rates
and Therefore Net Interest Costs
94
-$4 -$2-$26
-$121
-$206
-$252
-$319-$346
-$363-$398
-$418
-$500
-$400
-$300
-$200
-$100
$0
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Inte
res
t S
avin
gs
in
No
min
al $
Bil
lio
ns
Fiscal Year
Source: CBO budget baselines between March 2009 and January 2017. See “Obama's Fiscal
Legacy: A Comprehensive Overview of Spending, Taxes, and Deficits,” by Brian Riedl.
Note: Consists of net interest savings directly attributed to lower interest rates
from economic downgrades occurring between March 2009 and January 2017.
Post-2016 figures reflect latest estimates.Author: Brian Riedl,
Manhattan Institute
@Brian_Riedl
President Obama’s Eight Annual Budget Requests Proposed Large Tax and Spending Increases
95
$1,844
$988
-$265-$500
$0
$500
$1,000
$1,500
$2,000
No
min
al
$B
illio
ns
Proposed Tax
Increases &
Immigration
Revenues
Proposed
Spending
Program
IncreasesNet Interest
Impact of
Proposals
Source: OMB, President's Budget Proposals, FY 2010 - FY 2017. Includes new proposals hidden in the
budget baseline, and excludes OCO proposals due to the lack of a plausible baseline to score them
against. Also excludes current-policy extensions of long-time tax cuts and Medicare payment rates.
See “Obama's Fiscal Legacy: A Comprehensive Overview of Spending, Taxes, and Deficits,” by Brian Riedl.
Author: Brian Riedl,
Manhattan Institute
@Brian_Riedl
The Obama Spending Spree Ended When the GOP Took the House in 2011
96
$338
$515
-$216
-$23
-$70
-$18-$38
-$3
$314$16
-$34
-$39-$130
-$102-$119
-$95
-$300
-$200
-$100
$0
$100
$200
$300
$400
$500
$600
$700
111-1st(2009)
111-2nd(2010)
112-1st(2011)
112-2nd(2012)
113-1st(2013)
113-2nd(2014)
114-1st(2015)
114-2nd(2016)
No
min
al $
Bil
lio
ns
Mandatory Spending Enacted (rolling 10-year score)
New Spending Enacted by Year – Excluding Basic Renewals of
Existing Tax, Health, and Unemployment Policies
Yearly Discretionary Budget Authority Relative to
January 2009 CBO Baseline
Congressional Session and Year Enacted
Source: Author calculations based on CBO and JCT bill scores. Discretionary spending figures exclude emergency
appropriations for OCO (which would otherwise show even larger 2011-2016 savings) and Hurricane Sandy.
See “Obama's Fiscal Legacy: A Comprehensive Overview of Spending, Taxes, and Deficits,” by Brian Riedl.
Author: Brian Riedl,
Manhattan Institute
@Brian_Riedl