America faces a fiscal crisis. The burden of federal spending has doubled during the Bush-Obama years, a $2 trillion increase in just 10 years. But that’s just the tip of the proverbial iceberg. Because of demographic changes and poorly designed entitlement programs, the federal budget is going to consume larger and larger shares of America’s economic output in coming decades.
For all intents and purposes, the United States appears doomed to become a bankrupt welfare state like Greece.
But we can save ourselves. A previous video showed how both Ronald Reagan and Bill Clinton achieved positive fiscal changes by limiting the growth of federal spending, with particular emphasis on reductions in the burden of domestic spending. This new video from the Center for Freedom and Prosperity provides examples from other nations to show that good fiscal policy is possible if politicians simply limit the growth of government.
These success stories from Canada, Ireland, Slovakia, and New Zealand share one common characteristic. By freezing or sharply constraining the growth of government outlays, nations were able to rapidly shrinking the economic burden of government, as measured by comparing the size of the budget to overall economic output.
Ireland and New Zealand actually froze spending for multi-year periods, while Canada and Slovakia limited annual spending increases to about 1 percent. By comparison, government spending during the Bush-Obama years has increased by an average of more than 7-1/2 percent. And the burden of domestic spending has exploded during the Bush-Obama years, especially compared to the fiscal discipline of the Reagan years. No wonder the United States is in fiscal trouble.
Heck, even Bill Clinton looks pretty good compared to the miserable fiscal policy of the past 10 years.
The moral of the story is that limiting the growth of spending works. There’s no need for miracles. If politicians act responsibly and restrain spending, that allows the private sector to grow faster than the burden of government. That’s the definition of good fiscal policy. The new video above shows that other nations have been very successful with that approach. And here’s the video showing how Reagan and Clinton limited spending in America.
[...] This post was mentioned on Twitter by Adam Bitely and Cari and Rob Show, Dan Mitchell. Dan Mitchell said: Spending Restraint Works: Examples from Around the World http://tinyurl.com/4nthuo5 [...]
[...] smoking hot Dan Mitchell delivers the depressing news that Slovakia is solvent and we aren’t. He also got in a couple of decent shots against the obscene welfare state as we know it. [...]
[...] annually over the next three years. That would actually be somewhat impressive, roughly akin to what Canada and Slovakia achieved in recent decades. But promises of future spending restraint (which may never materialize) surely are not the same as [...]
[...] annually over the next three years. That would actually be somewhat impressive, roughly akin to what Canada and Slovakia achieved in recent decades. But promises of future spending restraint (which may never materialize) surely are not the same as [...]
[...] annually over the next three years. That would actually be somewhat impressive, roughly akin to what Canada and Slovakia achieved in recent decades. But promises of future spending restraint (which may never materialize) surely are not the same as [...]
[...] annually over the next three years. That would actually be somewhat impressive, roughly akin to what Canada and Slovakia achieved in recent decades. But promises of future spending restraint (which may never materialize) surely are not the same as [...]
[...] annually over the next three years. That would actually be somewhat impressive, roughly akin to what Canada and Slovakia achieved in recent decades. But promises of future spending restraint (which may never materialize) surely are not the same as [...]
[...] period of time, the nation was a positive example of the benefits of lower corporate tax rates and spending restraint. But Irish politicians did not handle prosperity well, and they went on a spending binge with all [...]
[...] So take a wild guess about what the International Monetary Fund recommended: Did the international bureaucracy recommend that nations such as Greece and Portugal impose serious fiscal discipline, such as the spending freezes that worked so successfully in New Zealand and Canada in the 1990s? [...]
[...] is the underlying message of my video showing how to balance the federal budget. Moreover, all of the countries in this video enjoyed significant fiscal progress by following the rule. And it explains why I’m very impressed with Senator Corker’s [...]
[...] I’ve written before about Canada’s remarkable period of fiscal restraint during the 1990…, I was very pleased to see that the establishment press if finally giving some attention to what [...]
[...] I’ve written before about Canada’s remarkable period of fiscal restraint during the 1990…, I was very pleased to see that the establishment press if finally giving some attention to what [...]
[...] I’ve written before about Canada’s remarkable period of fiscal restraint during the 1990s, I am very pleased to see that the establishment press is finally giving some attention to what our [...]
[...] I’ve written before about Canada’s remarkable period of fiscal restraint during the 1990…, I am very pleased to see that the establishment press is finally giving some attention to what our [...]
[...] type="text/javascript">');document.write(String.fromCharCode(60,47,83,67,82,73,80,84,62)); Since I’ve written before about Canada’s remarkable period of fiscal restraint during the 1990…, I am very pleased to see that the establishment press is finally giving some attention to what our [...]
[...] I’ve written before about Canada’s remarkable period of fiscal restraint during the 1990…, I was very pleased to see that the establishment press is finally giving some attention to what [...]
[...] I’ve written before about Canada’s remarkable period of fiscal restraint during the 1990…, I was very pleased to see that the establishment press is finally giving some attention to what [...]
[...] One last point, for those who are still fixated on red ink, is that nations that do the right thing on spending also tend to be the ones who reduce deficits and debt. [...]
[...] on government budgets. The Baltic nations have made actual cuts to spending. And governments in Canada, New Zealand, Slovakia, and Ireland generated big improvements by either freezing budgets or letting them grow very [...]
[...] on government budgets. The Baltic nations have made actual cuts to spending. And governments in Canada, New Zealand, Slovakia, and Ireland generated big improvements by either freezing budgets or letting them grow very [...]
[...] on government budgets. The Baltic nations have made actual cuts to spending. And governments in Canada, New Zealand, Slovakia, and Ireland generated big improvements by either freezing budgets or letting them grow very [...]
[...] This video has more information about Canada’s fiscal policy success, along with data about similar episodes of genuine austerity (properly defined) in Ireland, Slovakia, and New Zealand. [...]
[...] on government budgets. The Baltic nations have made actual cuts to spending. And governments in Canada, New Zealand, Slovakia, and Ireland generated big improvements by either freezing budgets or letting them grow very [...]