Every president this century – Biden, Trump, Obama, and Bush – has been a big spender. But I told an audience at the Acton Institute that there are still reasons for optimism.
All that is necessary is a modest amount of spending restraint.
More specifically, we can make progress so long as politicians follow my golden rule, which merely requires that the burden of government spending not grow faster than the private sector.
And I gave examples of that happening.
For instance, we had a five-year de facto spending freeze under Obama (including a sequester), thanks to the “Tea Party” spirit that temporarily animated Republicans on Capitol Hill.
I also mentioned the spending restraint that occurred during the Clinton years, which actually led to a budget surplus.
Reagan, of course, had the best track record.
As shown in this chart, the overall burden of domestic spending fell by 2.5 percentage points of economic output during his tenure.
We now know that good things happened in the past.
Let’s close by contemplating whether good things might happen in the future.
I am normally a pessimist, but I pointed out in the video that Republicans on Capitol Hill actually pushed for genuine entitlement reform during the aforementioned Tea Party era early last decade.
That zeal for good policy largely evaporated during the big-government Trump years, but I think it could return if a Reagan-style Republican won the nomination and was elected in 2024.
The bottom line is that we either control spending – including entitlement reform, or we surrender to European-style big government – including massive tax increases on ordinary people.
Those are the only two choices.
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Image credit: Bjoertvedt | CC BY-SA 3.
