Tim, I largely agree with you. (Read that again, I largely agree with you.)
My one major quibble is that defense spending as a percentage of the economy has been declining for decades. Let's do the thought experiement and eliminate all defense spending (because after all we don't have enemies, just friends whose grievences we haven't addressed); it only resets the budget baseline without changing the not so long-term budget diaster which is driven by entitlements. We can afford a social safety net and I would submit that most American's want and believe we should have a safety net. What we can't afford is giving entitlements to everyone, i.e. everyone can't be a net importer of tax dollars.
Folks on the right will have to reconcile themselves that a majority of American's want and believe that we should have a safety net and if they want to cut government spending, they need to man up and tell us exactly what they would cut. Politicians on the left need to grow a collective pair and come clean that even the current entitlement state costs a great deal more than we are currently paying (i.e. they are not 'investments') and can't be paid for by the 1%; everyone's taxes will have to go up; possibly a lot.
I would quibble with your characterization of business taxes; business don't pay taxes, they collect them for the government from their customers. Politicians like it because it allows government to collect more taxes from individuals but hide the real source of the tax; but we can haggle about that on another thread
And I largely agree with you. I take exception to the very last part, because it assumes that all costs of business are directly reflected in consumer prices, which is, just below the surface, a dismissal of market forces. You don't get to raise prices because your margins narrowed, regardless of the cause. You get to raise prices when the market will pay the higher price, or you get to fail. Social Security needs means testing. Healthcare reform needs to drive down the price of healthcare, and then the overwhelming majority of people need to pat for it themselves. There's your entitlements control. Next? Unnecessary wars, unwanted world policing, nation building, despot-propping...there's a whole lot of money spent -- billions -- on international interference that is not in the defense budget. But yes, "entitlements" are the biggest piece of the pie. They should be. We should spend more on our own quality of life than we spend on the rest of the world. I pat my taxes without much complaint. But I don't do it to build roads in Iraq or buy weapons for the Israelis. I don't do it to clear a path through the rubble for American business interests abroad. Let them clear their own path and put it in the price of my gas. I can choose to drive less.
Tim
