The Terrible Cost of Government

Published November 1, 2003

According to Americans for Tax Reform, Americans worked until mid-July this year to pay their whopping bills to the government. July 11 was “Cost of Government Day” for 2003, the date when the average American has worked enough in the calendar year to pay for government at the federal, state, and local levels. In other words, most Americans turn over more than half of everything they make to government–in taxes, fees, and regulations that increase the price of goods and services. For high-income individuals, the percentage can be much more than half.

The good news for Americans is that the Cost of Government Day is behind us for the year. The bad news is that the day keeps falling later and later, in fact 17 days later than in 2000. This is due largely to the rapid growth in federal spending in recent years. This relentless growth has increased the burden of government faster than national income has risen. The result is that taxpayers are left with less money to spend, save, or invest, while the legitimate private economy staggers under the weight of a growing federal leviathan.

Only during World War II–a momentous event requiring a huge mobilization of men, machinery, and supplies–did the federal government consume more of the nation’s productive economy than it does now. The federal government simply should not be devouring 40 percent of the nation’s gross domestic product!

For those who desperately want to see the size and scope of the federal government reduced, the first Bush term is a very serious disappointment. Spending levels are approximately 22 percent higher than when Bill Clinton left office. Health care spending has increased 36 percent in three years, education spending has increased 26 percent, and “community and regional development” spending, which includes boondoggles like HUD, has increased 31 percent. These purely domestic spending increases cannot be excused by terrorism or the war in Iraq.

Of course both Congress and a succession of Presidents are responsible for the spending mess. The President can set a tone for fiscal restraint or indulgence, and can veto spending bills if he has the political will to do so. Congress, however, actually crafts the laughable federal “budget” and appropriates the money, so the ultimate blame for spending increases must be accorded members of the House and Senate.

It’s easy to talk about smaller government, but few actually vote against the 13 annual appropriations bills that fund so many wasteful and unconstitutional departments, agencies, and programs. There are simply too many special interests counting on the money contained in the appropriations bills, and those same interests will take their campaign contributions elsewhere if a congressman fails to play the game.

The American people are also responsible for the growth in government, however. We have allowed our constitutional republic to deteriorate into a virtually unchecked direct democracy. Today’s political process is nothing more than a street fight between various groups seeking to vote themselves other people’s money. Individual voters tend to support the candidate that promises them the most federal loot in whatever form, rather than the candidate who will uphold the rule of law.

As the brilliant writer and professor Thomas Sowell said, “If you have been voting for politicians who promise to give you goodies at someone else’s expense, then you have no right to complain when they take your money and give it to someone else, including themselves.”

Congressman Ron Paul (R) represents the 14th District of Texas.