“[D]espite countless changes to the tax code — which included raising the top rate to 90%, then lowering it to 28%, then raising it and lowering it again — taxes as a share of GDP have rarely deviated much from that average.
So, even if all the Bush tax cuts were made permanent, federal taxes would end up slightly higher as a share of GDP than the historic average.
The CBO report also makes clear that it’s out-of-control federal spending that’s driving the deficits.
According to that report, the federal spending as a share of GDP is on track to steadily rise over the next decade and beyond, reaching 22.3% of GDP by 2022.
That’s significantly higher than the 1948-2008 average, and much higher than it’s been under previous Democratic presidents. In President Clinton’s last year in office, for example, federal spending consumed just 18.2% of GDP.
h/t to John Merline, Investor’s Business Daily.