Debt, Taxes and Politics: An Updated Perspective on Federal Tax History

Jon Economy, Fiscal Policies, Government, Health Care, Market Commentary, Politics, Socialism

With the Republican tax bill looming, we’ve updated this article to include the latest figures and estimates for federal debt and taxes.
Federal debt is defined as “the gross outstanding debt issued by the United States Department of Treasury since 1790” according to It does not include state and local debt, agency debt, nor entitlement programs such as Medicare and Social Security. It does include debt held by the public, debt held in government accounts, and by the Federal Reserve Board. Current federal debt per person is $62,814.
The first chart is a snapshot of federal debt with government forecasts through 2022 with an overlay of tax brackets since the onset of annual federal taxation in 1913.
As the chart clearly illustrates, the tax cuts in the early 1980s coincided with the beginning of an acceleration in real federal debt from a relatively consistent level over the previous three decades.

This post was published at FinancialSense on 11/14/2017.