But I must win the prize for being the biggest Christmas policy dork. I make this confession freely because there’s no other explanation for being very happy about this present from my girlfriend.
The Golden Rule, for those who have not endured my haranguing on the topic, is the common-sense notion that good fiscal policy is achieved when the burden of government spending shrinks compared to the size of the private sector.
And that occurs, needless to say (but I’ll say it anyhow), when government spending increases slower than the growth of private output.
Unfortunately, I fear government will grow far too fast in 2014, in part because of the Murray-Ryan budget deal that replaced automatic spending cuts with back-door tax hikes.
Compared to the size of the federal budget, the additional spending isn’t that large, so my real concern is that the pact sets the stage for bigger moves in the wrong direction at some point in the near future.
But let’s not dwell on potential bad news at this time of year.
Instead, let’s close with a better way of selling Mitchell’s Golden Rule. Here’s the Princess of the Levant showcasing the gift she made.
Since she gave this gift to me, it’s now my job to implement the Golden Rule as a gift to the entire nation.
That should be a simple achievement. If we simply limit government spending so it grows at the rate of inflation (about 2 percent per year), the burden of government spending will fall as a share of gross domestic product.
And even though I’m much more interested in reducing the size of the public sector than I am in fiscal balance, it’s worth noting that you can balance the budget by 2018 with this amount of modest spending restraint.
But even though this should be simple, it definitely won’t be easy. Convincing politicians not to spend is very analogous to convincing ticks not to suck your blood.
Actually, I apologize. That’s a very unfair analogy. The only really bad thing we get from ticks is Lyme Disease.
With politicians, by contrast, we get taxes, spending, and red tape on good days and war, genocide, and totalitarianism on bad days.