Your Tax Dollars At Work

Your Tax Dollars at Work

In case we should ever stop to question the government and the tax dollars of the US citizens has on the economy, let's take a look at the influence the government exerts over our daily lives, and the impact both good and bad of that influence.

The numbers are really staggering; the government controls, through direct spending about 43-45% of the economy. That's a truly amazing figure. Today more than ever, government spending accounts for almost as much of the economy as the private sector spending. During the late 30s and early 40s, right after the passage of the New Deal legislature, private sector controlled almost 90% of the economy. This should give you some idea as the drastic change we've experienced in only two generations. If you convert these percentages to real dollars and cents, this equates to roughly $13,000 in support by the individual citizen spent towards the government's taxation needs. When you turn this into working days, it equals 5.3 months of your work year are devoted to support government spending.

To step back, and clarify these statistics, first you must understand that the economy is divided basically into two sectors: there is one that is dependent upon federal, state, and local government spending, and this is known as the government sector, and then there's all others, known as the private sector. The government sector is funded by tax dollars collected from the individuals and businesses in this country. Therefore, whatever the government decides to spend and influence the economy with is basically funded by our tax dollars.

Total government spending controls $5.4 trillion dollars of the total spending, when you add the $1.4 trillion government imposed regulatory compliance spending the government actually controls almost 58% of the economy's national income. The disturbing factor for everyone involved here, is that this is a 3.5 times increase from a hundred years ago. That wouldn't be so disturbing if the rest of the economy had grown at the same rate, but it hasn't. It has seen a decline. The ability of private sector growth to produce living standard growth has been diminished over time, thanks to the fact that the government control has outgrown and overtaken the private sector control.

I don't think that's what our founding fathers had in mind when they wrote the Declaration of Independence, and declared their independence from the heavily governed England. They wanted less government control; The New Deal programs of the 30s, helped push us to a more "socialized" program of governing. One in which we look out for the masses, rather than relying on the initiative of human nature and private enterprise to take hold and provide individuals with the opportunities they need to better their lives.

Another interesting figure is the rate of growth for government employment compared with the growth of the population as a whole. While population has increased at a rate of 108%, government employment has increased by 476%; that's almost a 4 to 1 ratio in increase.
One of the biggest contributors to the increased government control comes from the special interest groups, and the ability of big business to lobby congress for programs, and changes in tax structure that benefits only a certain sector of the population. Another culprit is of course the socialized status of our government and the people it has tried to help. Government funded welfare and public assistance programs are a major contributor to the government spending programs.

This isn't what our forefathers intended, of that I'm quite certain. How do we attempt to correct this problem? No one is ready to answer this question, but here's an interesting statistic for you, if we don't soon correct the massive government spending, our children will pay $25,000 each year to support an overburdened and overbearing government.