Chart of the Day: Did Tax Cuts or Spending Cause the Deficit (or Both)?

Publication: The Atlantic

Author: Daniel Indiviglio


10/12/2011 - Democrats blame tax cuts for the ballooning U.S. debt problem. Republicans blame runaway spending. In this case, everybody is right. But one cause appears to be more to blame than the other.

Here's a chart prepared by Pew Charitable Trusts (.pdf) that shows the picture pretty clearly:

First, a note on the timeline here. As Pew notes in its study, 2001 was the last time the U.S. government had a surplus. At that time, the Bush tax cuts were not yet in effect. Since then, deficits have increased U.S. borrowing. Its 2011 numbers here are (presumably) estimates. This chart tells us a few things. From the end of 2001 through last Friday, the U.S. debt has increased by 250% from $5.9 trillion to $14.8 trillion -- so these seemingly small percentage of GDP changes add up very quickly.

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Read the article Chart of the Day: Did Tax Cuts or Spending Cause the Deficit (or Both)? in its entirety on The Atlantic Web site.

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