Washington has a mess on its hands.
To close the budget gap and start paying down the nearly $15 trillion in debt we've already incurred, legislators will have to make some very tough choices regarding which programs to cut.
Defense, education, transportation, social security, homeland security -- none of these will be spared the budget cutter's repeated axe.
How many cuts take place will depend on changes in tax policy -- a subject that seems to rub everyone the wrong way, regardless of how they feel on the issue. The overwhelming consensus (or at least the loudest) is that corporations and individuals alike are already overtaxed.
The trouble is, history argues otherwise. If anything, taxes are at a multidecade low thanks to major tax breaks granted by both the Bush and Obama administrations.
Don't believe me? Let's look at the numbers.
Back in the early 1950s, corporate America paid enough in taxes to account for roughly 5% of the size of the U.S. economy . Not anymore. This figure now stands at 1%.
-- David Sterman
Disclosure: Neither David Sterman nor StreetAuthority, LLC hold positions in any securities mentioned in this article.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
© Copyright 2001-2010 StreetAuthority, LLC. All Rights Reserved.