Interesting chart from Heritage, referenced in a Forbes article …
Couple of takeaways:
As the headline says, Fed revenues have tripled since 1965 … that’s about 3% per annum … pretty much in line with GDP growth.
No big news there.
I added the line connecting 1965 and 2010 … note the 2 recent bulges above the long-term trend line … the first courtesy of the Clinton tax hikes and the dot-com bubble … the 2nd courtesy of the Bush tax cuts and the housing bubble.
What’s common?
Fed revs jumped during the bubbles … but, rather than the Feds treating the inflows as “found money”, they treated it as a permanent change in the revenue stream and poured it into spending programs … all of which are now apparently untouchable.
Hmmm.
The Homa Files 