Don't listen to politicians about the budget.

Many Americans favor balancing the governments budget so that we don't leave massive, crippling debts for our children to deal with, however there is a real misconception on what it is going to require to balance our budget.  Many politicians try to make it sound easy as long as you elect them but here are some numbers to help you understand just how difficult it would be.

First, lets compare federal income and expenses for 2011:  (all numbers are in Billions of dollars)
Income: $2,303 B
Expenses: $3,603 B

So our budget deficit is  $1,300 B

The majority of Americans would like to cut spending rather than increase taxes so lets look at what different areas cost. 

Pensions:            $776 B    ($730 B of this is social security)
Healthcare:         $858 B    ($275 B is Medicaid and $485 is Medicare)
Education:          $114 B
Defense:             $844 B
Welfare:             $352 B    
Unemployment: $121 B
Protection:          $56 B     (Federal courts and FBI)
Transportation:   $93 B     (Mostly highways and air control)
Interest:              $230 B
Foreign Aid:        $34 B
Other:                 $125 B

The programs I've heard complained about most often by people who want a balanced budget are:
1) foreign aid
2) welfare and medicaid
3) discretionary spending  (this would include Protection, Transportation, Education and Other)

However, even if we cut 100% of these programs we would only have cut spending by $1,049 B and would still be running a deficit of $251 B.  Also, this would have cut funding for a lot of programs with wide support like federal highways, the federal courts and research (not to mention all the people that will likely end up hungry and in the streets when welfare is cut).

So to balance the budget we have to make cuts to some of the programs that everyone seems to defend like social security, medicare, and defense.  These 3 programs are almost untouchable in political debates because so many people defend them but these 3 alone cost more than the government brings in each year.

So balancing the budget either requires cuts to programs you probably love and want to protect or it requires significant tax increases.  Now when a politician makes balancing the budget sound easy you will know he is full of crap.  This is a problem that is even worse in reality than people want to believe.


Note:  The numbers might not be quite so bleak if the economy was doing better, however I don't think the data will change too much even in better economic times.

data from: http://www.usgovernmentspending.com

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