The Gap Between Tax Revenues and Government Spending | The Business Desk with Paul Solman | PBS NewsHour

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In the fall of 2007, when the U.S. economy first seemed in peril, I began answering reader queries here on the Business Desk. I still do so, but this page has expanded to include posts from eminent economists, "far-flung correspondents," and a variety of voices that have intriguing and/or useful things to say about economics, broadly defined. Please feel encouraged to respond to any and all of them.

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The Gap Between Tax Revenues and Government Spending

U.S. Capitol; photo by Chip Somodevilla/Getty Images A bicyclist rides through the plaza on the east side of the U.S. Capitol. Photo by Chip Somodevilla/Getty Images

Paul Solman answers questions from the NewsHour audience on business and economic news here on his Making Sen$e page. Here is Friday's query:

Name: Maggie Van Ess

Question: If the banks paid back the taxpayers' loans used to bail them out, why are we continuing to cut services the taxes were for?

Paul Solman: Because the bank money is a pittance in the overall government budget, a small fraction of our annual deficit, which tallies the yawning gap between tax revenues and spending. (The U.S. collects the fourth lowest taxes, as a percentage of the economy, of all the 34 OECD market-based countries. Only Turkey, Mexico, and Chile tax their people less.)

Bottom line? Like most people pretty much everywhere and pretty much always, Americans want government services but don't want to pay for them. Unlike most governments in the world these days, however, ours gives the people what they want.

This entry is cross-posted on the Rundown- NewsHour's blog of news and insight. Follow Paul on Twitter.

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-- Posted April 20, 2012 | Comments ( ) | Permalink