You're watching...
Heritage Foundation Data Analysis Director William Beach on the government’s stimulus spending and efforts to reach a deal to avoid the fiscal cliff...
Also in this playlist...
Auto-advance: ON
Auto-advance
This transcript is automatically generated
The business of government soul out of control -- to apply any kind of accounting rules to what's going on.
With the budget right now may seem a little out of place but since president said yesterday that math does still matter we thought we talk some budget math.
With the -- -- -- -- -- from The Heritage Foundation so bill.
Let let's start first with the spending side and what what I call a never ending stimulus because it was supposed to be a one shot deal -- eight -- billion dollars 2009.
But then it continued and we can put up a chart showing how it jumped from 2008 to 2009.
-- About 800 billion dollars you can see that the bottom there.
And then it just continue in 2010.
-- 2011 in 2012.
Where is all this money going.
-- it's supposed to be going to the cutting edge of the economy you know small business creation you have peace on this earlier.
It's not going there were at the slowest rate of any recession since World War II in small business formation the slowest possible rate but they'll -- -- This copyright here because.
And yet you know I've been gone through the numbers not been trying to figure this out I've really -- try to figure this out.
How did that 25%.
Increase in government expenditures huge increase -- -- -- an increase like that.
Since World War II how did that become -- how to go from being a one shot deal was stimulus in 2009.
To becoming part of the baseline budget.
Well that that's the way it works in Washington David -- you know that once congress puts in place.
A spending increase they re appropriated they built into the baseline they continued to do the sort of things which -- they were doing before.
Construction projects need to be expanded right across the street from this particular studio we have a big train station called Union Station.
There's a construction project in front of that which has been going on for three years all stimulus money -- -- -- and -- it's an end and the point I was raising is that it should've gone is should've gone to the job creators but because.
-- didn't but it went to the institutional.
Interest here is that you know the big the big businesses where the lobbies that -- big construction projects.
Because most of it can be -- we actually know where where that where the money went in general.
It didn't go to places that -- caught with a cause the economy to recover.
Against surprise right okay so you gotta pay for that extra 25% which is -- -- president once -- 125%.
-- -- but he's he's talking a very different tune right now he says it's impossible do without raising tax.
Rates this is what he said about a year ago take a listen.
What we said was.
Give us one point two -- in additional revenues.
Which could be accomplished without.
Hiking taxes tax rates but could simply be accomplished by eliminating loopholes.
Eliminating some deductions.
And engaging in a tax reform process that -- lower rates generally.
While broadening the base.
Well bill -- -- compromise the president just said what the -- if he was just say that today we would have no fear of going over the fiscal cliff.
Absolutely not I mean we do we need a new tax code that's that's absolutely.
The based thing we need to have.
And it is should have lower rates and it should come alternately tax reform does -- like taking out all the junk in the in the code -- -- extraordinary thing is he said.
Exactly what Republicans are calling for which could end at the squabbling it could bring us to a deal he also said the following this is from his principles for tax reform.
From his budget in 2000 leapt eleven to lower tax rates.
He said the tax system should be simplified and work for all Americans with lower individual and corporate to corporate tax rates and fewer brackets again.
That is the compromise we're all looking for quickly.
-- it it is actually -- let let me take you back to where you started that is we have these big increases in spending that seem to be in the budget right now.
Those that's really where where where the other side on this debate wants to go increased spending they need to increase revenues so why not go over the fiscal cliff.
Where you get both of those and I think that's where we're headed David unfortunately.
Bill BH director emeritus foundation center for data analysis thank you for that analysis good to -- bill.
-- --
