Contact us
CALL US NOW 1-888-GOLD-160
(1-888-465-3160)

Peter Schiff: The Government Doesn’t Actually Budget

  by    0   1

President Biden has proposed a borrow and spend “to infinity and beyond” budget featuring $6 trillion in government spending. That’s the largest amount of spending ever proposed in a presidential budget. In the following podcast clip, Peter Schiff argues it’s not accurate to call it a “budget.” The federal government has given up on actual budgeting.

Keep in mind that all government spending ultimately equals taxation.

If the government is going to spend $6 trillion, it needs to deprive the economy of $6 trillion worth of recourses one way or another.”

The Biden budget includes some tax increases, but they won’t come close to funding the $6 trillion budget.

So, most of the money is going to be printed into existence by the Fed, which means instead of paying for all this government with an income tax or some kind of excise tax, the average American is going to get the bill through the inflation tax, meaning the price of everything you want to buy is going to go up.”

The inflation tax is the most pernicious tax because the government can get away with levying it and most people don’t even notice.

The $6 trillion figure only accounts for official spending. The government spends a lot of money that isn’t “official.”

It’s not on budget, and it doesn’t count. It counts in that we’ve got to pay for it as taxpayers, but it doesn’t count as far as the government being honest in reporting how much it’s going to spend.”

Consider natural disasters. The federal budget doesn’t set aside money to pay for disaster relief, but it doles out disaster money every single year. If the government was actually budgeting, it would look back over time, figure out the average spent each year for federal disaster relief, and make that a line item in the budget.

We know we’re going to spend the money. It should be in there. It’s not.”

In a nutshell, if the government says it plans to spend $6 trillion that means it will probably spend $7 trillion, if not more.

It’s an even bigger tax than the one they’re threatening to impose.”

So, why do we even call this a budget?

I don’t even think budget is the appropriate term to use to describe what the government is offering up here because it’s not a budget.”

Think about your family budget. The first thing you do is figure out how much money you have. You figure out how much you can spend based on your income. Then you prioritize and decide what you will spend your money on. When it’s all said and done, your spending budget will at least roughly approximate your income.

You want to make sure you budget your spending because you want to live within your means, and you want to make sure that you spend the money that you have.”

That’s not what the federal government does.

The government doesn’t even care what the revenue is. The government just figures out what it wants to buy, what it wants to spend money on. And that’s what the budget is. It’s just a spending proposal.”

This is not a budget.

Of course, a lot of people will say a government isn’t like a family. With its power to tax, it can always get more money so it can spend what it wants.

No. They can’t. I mean, they can do it for a while until there is a crisis. The reason they can get away with it is because people think, ‘Well, you know, the government can just raise taxes and get more revenue.’ Well, not really. Because raising taxes is politically impossible at this point, unless you’re going to raise taxes on the rich. But when you’re raising taxes on 1% of the population, and the other 99% are off the table, there’s only so much revenue you can get by raising taxes.”

Of course, the government can just print money to pay for spending.

Well, that only works until the money they’re printing no longer has any value. And we are very close to hitting that point.”

Gold IRA Rollover to 401k

Get Peter Schiff’s key gold headlines in your inbox every week – click here – for a free subscription to his exclusive weekly email updates.
Interested in learning how to buy gold and buy silver?
Call 1-888-GOLD-160 and speak with a Precious Metals Specialist today!

Related Posts

Artificially Low Interest Rates? So what?

The Federal Reserve has held interest rates artificially low for decades. Even after pushing rates to zero in the wake of the 2008 financial crisis, “normalization” only managed to raise rates to 2.5% — hardly “normal.”  The central bank began cutting rates in 2019, even before the coronavirus pandemic. But what difference does it make? […]

READ MORE →

Peter Schiff: What’s Going on With the Price of Gold?

Gold has been rangebound of late, bouncing between $1,750 and $1,800 an ounce for several months. Given the inflationary environment, one would expect gold to be soaring. So, what’s going on with the yellow metal? And when will the price of gold go up? Peter Schiff tackled this question during a recent Q&A session on […]

READ MORE →

Peter Schiff: There Is Only One Type of Inflation

When talking heads and politicians talk about inflation, they tend to make distinctions between “food inflation,” or “energy inflation,” or “wage inflation.” In this clip from his podcast, Peter Schiff explains that this isn’t the right way to look at inflation. In fact, there’s only one type of inflation. And the Federal Reserve is the […]

READ MORE →

What’s the Difference Between Naturally and Artificially Low Interest Rates?

We know that the Federal Reserve pushes interest rates artificially low by manipulating the federal funds rate (the target interest rate that commercial banks borrow and lend their excess reserves to each other) and using monetary policy maneuvers such as quantitative easing. But could we have low interest rates without Fed intervention? In this clip, […]

READ MORE →

Peter Schiff: The Debt Ceiling Is Really a Debt Floor

We have a temporary truce in the debt ceiling fight. On Thursday, President Biden signed a bill increasing the federal debt limit by $480 billion. But this isn’t an end to the debt ceiling fight. Congress just kicked the can down the road. The increase is only expected to keep the US government solvent until […]

READ MORE →

Comments are closed.

Call Now