Has anyone noticed that the president has proposed increasing federal spending by nearly $1 trillion a year, while promising that 98% of Americans will pay nothing for it? The very idea would have seemed mad to every previous generation of Americans. Today it is considered conventional.
From 1970 onward, the country has shifted to a budget-deficit policy—spending more than current revenue as a matter of routine.
Deficits had averaged 3% of spending in 1950-69. Then, deficits grew to 10% of spending in the 1970s and 18% in the 1980s. The U.S. borrowed for 22% of spending in 2019, a growth year that would have called for a budget surplus under the old regime.
Federal expenditures have shifted to benefits. In 1970, about 36% of federal spending, net of interest payments, was benefits to individuals—Social Security, Medicare and Medicaid (new programs at the time), unemployment compensation, means-tested welfare benefits. Benefits spending then grew mightily, roughly in tandem with deficit spending, and is now about 76% of spending, heading briskly toward 80%.
