Back in 2012, I shared some superb analysis from Investor’s Business Daily showing that the United States never would have suffered $1 trillion-plus deficits during Obama’s first term if lawmakers had simply exercised a modest bit of spending restraint beginning back in 1998.
And the IBD research didn’t assume anything onerous. Indeed, the author specifically showed what would have happened if spending grew by an average of 3.3 percent, equal to the combined growth of inflation plus population.
Remarkably, we would now have a budget surplus of about $300 billion if that level of spending restraint continued to the current fiscal year.
But let’s look beyond the headlines to understand precisely why a spending cap is so valuable.