Federal tax receipts are running $45 bln above last year. That's about 0.3% of GDP. It's no surprise why the economy is sluggish and jobs are not being created fast enough. Way too much fiscal drag. Fiscal drag from a massive amount of spending cuts (read my earlier post) and fiscal drag from too much taxation.
*Chart covers Oct 2010 thru April 9, 2012
Obama is listening to advisers who want to INCREASE fiscal drag, by raising taxes and cutting spending. That would surely push the economy into recession. Start getting ready, because that's exactly the fiscal package we will be getting next year.
1 comment:
What is so magical about the status quo that any change from it, is grounds for this hysteria?
What if government increased spending to take up 99% of GDP, and increased taxes to 99%, and then contemplated reducing spending and cutting taxes?
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