Tax Freedom Day Today

Generally speaking, it is Tax Freedom Day (TFD) today... not factoring in State by State adjustments.

The good news is, this is the earliest TFD since 1967.

The bad news is, we probably won't see it coming this early for a VERY VERY long time here in the USA.

You can thank the Bush tax cuts (and the poorly designed Stimulus Bill) for TFD happening so early this year... and, likewise, you can thank the Obama Administration next year when it's delayed. How much will it be delayed? This article paints the grim picture of where we are now heading:

However, this year more than most, TFD, average or not, does not adequately reflect the burden borne by taxpayers. Spending, whether financed by taxes or borrowing, is the best measure of government's fiscal impact. This year more than a third of government outlays are borrowed funds. Total government expenditures are at record levels. You have to go back to the last two years of World War II to beat this year's spending burden.

Reports the Tax Foundation:

"Because of the federal government's ability to deficit-finance its operations, Tax Freedom Day moves somewhat independently from an alternative calculation that adds the federal budget deficit to total taxes collected. In 2009, an unprecedented budget deficit over $1.5 trillion produces a date of May 29, fully forty-five days later than Tax Freedom Day." [link]

Now, there are a lot of people attending Tea Parties on tax day this year... and there are some media outlets "snearing" at them, dismissing the Tea Parties as a political gambit using taxes as an excuse. Even, albeit to a smaller degree, FOX News Channel has been emphasizing the tax side of the story.

But, it began with public outrage against massive Government spending... (see the Rick Santelli video).

You know it. We know it. All responsible adults know it.

You can't keep robbing Peter to pay Paul. The more money they borrow to throw at the Recession, the higher the burden will be on taxpayers in the years to come.

How bad, you might be wondering?

Runaway spending ensures that this year's TFD will be dwarfed by future TFDs. Some day someone will have to pay off the debts being run up today. The Obama administration's budget figures are bad enough, but they almost certainly rest upon unrealistic economic expectations. The CBO again offers a sobering analysis: "CBO's estimates of deficits under the President's budget exceed those anticipated by the administration by $2.3 trillion over the 2010-2019 period."

The agency's bottom line is even more astonishing. CBO reports that "the President's proposals would add $4.8 trillion to the baseline deficits over the 2010-2019 period," leading to a deficit of $1.8 trillion in 2009 (compared to the Tax Foundation's $1.5 trillion assumption) and $1.4 trillion next year. Moreover, "The cumulative deficit from 2010 to 2019 under the President's proposals would total $9.3 trillion, compared with a cumulative deficit of $4.4 trillion projected under the current-law assumptions embodied in CBO's baseline. Debt held by the public would rise, from 41 percent of GDP in 2008 to 57 percent in 2009 and then to 82 percent of GDP by 2019." Congress trimmed a bit from the president's proposals when it approved the budget in early April, but actual federal spending almost always ends up far higher than initially projected. [link]

There's more distressing news. Read the full article (particularly page 2) and you will quickly see there is cause for alarm. Better have your blood pressure pills handy before reading it.

The article closes with this food for thought:

In the midst of economic crisis, it is tempting to celebrate the Tax Foundation's report on TFD as a little bit of good news -- sort of the tax quiet before the spending storm. Alas, the bad news is really bad. The best case is a big increase in spending, smaller GDP, and much higher tax burden. The worst case is financial crisis and collapse.

So, as we approach the Tax Day Tea Parties, don't be fooled by media wingnuts claiming this is all about partisan politics. It's possible they haven't got a clue what a trillion dollars really looks like. I recommend they watch this video: Crash Course: Chapter 11 - How Much is a Trillion? by Chris Martenson

Just because the Tea Parties are massive on Tax Day, don't dismiss them as being only about taxes...

To many, they're about "NO MORE BAILOUTS."

To others, they're about "NO MORE FAKE STIMULUS."

To others, they're about "NO MORE TAXES."

To others, they're about "NO MORE DEBTS."

And to the great majority of people that will be attending, both those who voted for Obama and those who did not, it's about feeling disenfranchised, ignored, patronised and unheard.

Personally, I've been watching this Administration with growing horror as they dance around dishing out blank checks in the form of massive Government guarantees and bailouts of astronomical proportion, with budgets and stimulack plans that pile on the pork and worse... they're acting like irresponsible kids with their first gold credit card -- leaving the consequences of their rash actions for the taxpayers of both present and future generations.

'Nuff said.

Happy Tax Freedom Day.