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On theRoad toRuin?
W
e've come a long way
since the early days of the
epublic, when the federal
budget amounted to a few "paltry"
tens of mil lions of dollars. lt took a full
173 years- from the founding of the
United States in 1789 until 1962-for
America's national budget to hit the
staggering $100 bi llion mark. lt took
only nine more years, until 1971, to
reach $200 bill ion. Four years later
we surpassed $300 bi llion, and two
years after that, $400 bil lion. Now,
President Carter has proposed a
$500 billion budget for fiscal 1979,
which begins October 1, 1978-an
increase of $38 billion from the pre–
vious year.
lt's hard for the average person
to grasp just how much a half-tril–
lion is. Here's one way: lf you put
that amount in a line of dol lar bil is
laid end to end, it would reach to
the moon and back 250 times!
Stacked up, 500 bi llion silver dol–
lars would reach as high as
2,830,500 Empire State Buildings.
Looking at it another way: lf you
had started at the birth of Christ to
spend $700,000 a day, 365 days a
year, you would just now, in 1978,
finally be getting rid of $500 bil lion.
Now we are going to be spending
that much in a single year! And by
fiscal year 1986-just eight years
away- we wil l probably be spend–
ing double that amount: a full triIl ion
dollars! The prospect is mind–
bogglingl
38
Moreover, the government ex–
pects to take in by taxation only
$440 bi llion (if one can use " only"
to describe such a sum), assuming
President Carter's proposed $25
bi llion tax cut to stimulate the econ–
omy is enacted this fall. This would
leave a budget deficit of slight ly
over $60 billion to be covered by in–
creased government borrow–
ing-and that on top of a roughly
equal red-ink total for fiscal 1978.
We wil l thus be racking up the big–
gest two-year <;leficit in the history
of the nation.
This gives us yet another way of
putting the new budget into per–
spective. In the coming fiscal year,
the federal deficit alone- $60 bil–
lion- will be nearly 12 times greater
than the entire federal budget dur–
ing Herbert Hoover's last year as
president! In that year, the federal
budget totaled less than $5 billion,
a mere one-hundredth of today's
figure.
Continued deficit spending has
resulted in a steadi ly growing na–
tional debt now standing at some
three-quarters of a tr i llion
dollars- almost $3300 for every
man, woman, and child in the
nation. Moreover, the interest
which must be paid on this debt–
just as prívate individuals have to
pay interest on loans frorri banks–
amounts to over $50 bil lion annu–
ally. Thus, the interest burden on
our national debt will constitute a
full ten percent of the 1979 fiscal
budget!
What are the reasons for the
soaring growth in government
spending? Why is it that Washing–
ton-like many individual Ameri–
cans- just can't seem to hold down
expenditures and bring its spending
into line with its income?
lnflation, of course, is partly re–
sponsible for the record leaps in
federal outlays in recent years. But
then again, inflation is largely
caused by the borrowing and
money supply increases neces–
sitated by government over–
spending. lt's a vicious circle from
which Washington just can't seem
to break loose. lt is part of the fa–
mous " inflationary spiral."
But inflation is by no means the
only culprit, as we can see by mea–
suring federal spending as a per–
centage of the gross national
product (GNP), the dollar value of
the country's total output of goods
and services. Going back again to
the presidency of Herbert Hoover,
the federal government was taking
only 2.5 percent of the GNP when
he assumed office in 1929. Today,
Washington's share of the GNP is a
walloping 22 percent!
Aside from inflation, the single
most significant factor in the soar–
ing government budget is the
alarming jump in recent years in
outlays for social services-health,
education , welfare , and various
The
PLAIN TRUTH April 1978