The bottom line is simple: as much as we're all in favor of cutting unnecessary spending, spending is just not a big problem right now. The simple fact is that total federal spending is about 20% of GDP, the same as it was 30 years ago.
Thanks to George Bush's tax cuts, however, revenues are lower than they've been since the 1950s. So if you're really serious about paying for Katrina reconstruction, the Center on Budget and Policy Priorities has the answer: repeal of a pair of tax cuts scheduled to go into effect in January that are aimed exclusively at families with high incomes (97% of the benefit goes to families with incomes over $200,000). What's more, this windfall is solely a creature of Congress. President Bush never asked for it.
Well off families have already gotten plenty of tax cuts in the past four years. They can do without another one, and repealing these two measures would save an estimated $197 billion. It's not a tax increase, since it would leave current law just as it is, and it would save enough to pay for Katrina without blowing an even bigger hole in the budget than we already have. Responsible conservatives should give this their blessing.
