[Below is a hastily written, if longish, rant on the 4th of July and subject to further revision.]

I’m sitting by a bucolic lake on this 4th of July, our celebrated national birthday even though the actual vote to declare independence took place on July 2nd. Nevertheless, all is rather peaceful, even serene. Yet, my state of mind is troubled, as you might imagine. The MAGA movement continues unvexed and inexorably moving toward our possible national demise with the passage of Trump’s megabill, a travesty imagined and created by the architects of the 2025 plan. In case you missed it, that political and policy agenda is the blueprint through which an authoritarian oligarchy replaces democracy in America, one premised on the assumption of total power by an economic and political elite. So far, the push for power looks more like a kakistocracy (rule by the most incompetent) than a kleptocracy (rule by the wealthy for their personal enrichment) though the latter might best describe the latent intentions of the insurrectionists.

No matter the label, the American democratic experiment appears to be tottering on its last legs. Budgets, as I’ve oft noted, reflect underlying values and signal political intent. Thus, the MAGA megabill defines our emerging normative preferences quite clearly. Many note that this legislation will slash spending on critical domestic needs, including spending on health care for needy populations through Medicaid. Nursing homes that care for less affluent elderly and the disabled will struggle for survival. But that is just the beginning of the envisioned hollowing out of federal investments in the public good. There is little doubt that amenable suffering and deaths will occur among our most vulnerable citizens.

On the other hand, we will spend an additional $171 billion to enforce a set of immigration related initiatives primarily designed to return white native-born residents to a form of hegemonic superiority, or at least the illusion thereof through demographic dominance. These increased outlays include $51 plus billion to extend and enhance our Mexican wall, some $45 billion for camps to house those swept up in ever ubiquitous ICE raids (the updated American version of NAZI concentration camps), and another $30 billion for the American equivalent of our reborn Gestapo in training … our masked and secretive ICE force. Under the megabill, we will pay more to support ICE operations than many nations expend on their entire defense budgets … Italy, Israel, and Brazil for example.

While there are many specific provisions that increase Trump’s executive authority littered throughout the 900 plus page bill, thus facilitating our drift toward autocracy, the extension of yhe 2017 tax cuts remain the heart and soul of the legislation. What does this particular policy thrust  do? It adds over $3.3 trillion (perhaps more) to our national debt, more on this later. It also contributes to the hyper- inequality of income and wealth which, if continued unchecked, cannot help but lead to a tearing apart of our social fabric.

Yet, here is the current irony. The GOP once were the defenders of fiscal probity. They raged against deficit spending. They once argued that we had to get our fiscal house in order. Terms like bloated budgets and out of control spending or government overreach fell so often from their mouths that listeners thought each phrase was really a single word since the separate parts were always joined together. As Nazi propagandist Joseph Goebbels never tired of pointing out, lies repeated often enough ultimately become a consensual truth.

I am reminded of the many poverty related talks I gave throughout the country during the 1980s and 1990s when social welfare issues, particularly welfare reform, was a front burner issue. While many of these were to academic audiences, many others were to policy or lay audiences of various stripes. I would often start my talks out with a number or two. The national poverty rate today is 15 percent (or 12 percent or whatever it was at the time). I might then discuss the problems with our measure of poverty. After all, even concepts we think we understand can be confounding.

Inevitably, however, I would segue to a critical point; How should we react to this metric? Is it high or low? Are you outraged or relieved? The number, I would argue actually is peculiarly neutral. Meaning comes from context and comparative assessments, often done at a subconscious level. If we have in mind what I would term a reservation rate (a minimum acceptable rate like 5 percent for a rich nation like us), then 15 percent is shockingly high. Our child poverty rates (20 percent in some years) might well be seen as even more disturbing.

In most cases, though, we established the meaning of these naked numbers (those offered absent context) by viewing them in a comparative manner. We might look at rates over time to see if progress was being made. Spoiler alert: we stopped making progress in the early 1970s after years of decline. Or we might compare our numbers against those of peer nations. Another spoiler alert: we look awful when our rates are compared to those of other advanced countries. Other comparisons are possible. The key notion is this … we need reference points to make sense of what we are examining. Context confers substance.

Between now and the mid-term elections, we will be subject to a blizzard of competing assertions and claims about the worth and meaning of the megabill and the MAGA agenda. Establishing some context is a necessary first step. So, let us start once again with a simple number … the federal government spent $6.8 trillion in the last fiscal year. Is that a bloated number, signifying a similarly bloated bureaucracy? Is it prima-facie evidence of fraud and waste? Is this the smoking gun revealing public overreach? After all, it does seem like a lot of money.

We could look at where it goes. The big items go for health care, security for our elderly and vulnerable, and defense. For example, we spent $1.5 trillion on Medicare and Medicaid, another $1.5 on Social Security, and still another $1.1 trillion on defense (including veterans needs). That is, slightly more than 60 percent is going for public needs that, until recently, have been sacrosanct. As Musk proved, you have to savage virtually all else to ‘save’ enough to provide a rationale for further tax breaks for the uber-rich.

So, let’s look at another natural reference point. Overall, the U.S. spends 38% of its GDP on public goods and needs (about 20 percent from federal spending and the remaining 18 percent from state and local coffers). Wow, almost 4 dollars in every 10 flowing through our economy is a public expenditure. Surely, this is clear evidence of a bloated government.

But hold on, let’s look at our G-7 partners. Japan spends 42% of its GDP on public needs, the UK 44%, Spain 45%, Sweden 48%, Italy 55%, and France coming in at a whopping 57%. And I haven’t even mentioned most of the big spenders in Scandinavia like Denmark and Norway. Such nations are at the top of the big spenders list and yet consistently rank at the top of international hedonic surveys that tap public happiness across nations. That is, they oddly enough have the happiest citizens.

Of course, there is no free lunch as we all know. Someone has to pay the bills. Take a high spending nation like Sweden. It spends 48% of its GDP on public needs, but only takes in the equivalent of 44% in various taxes and revenues. The UK is another example. It takes in 38% as opposed to 44% in outlays. The gaps between outlays and revenues are typically filled with borrowing which leads to annual budget deficits and then accrued debt over time. After years of borrowing, the accrued debt in Sweden comes to 34% of their GDP. That might be considered high until you look at other places. The UK, which has relied somewhat more on borrowing than the more prudent Swedes, now has an accrued debt that represents over 100% of the size of their economy.

Then we come to us. We bring in a little less than 30% of our economic engine (GDP) in public revenues in a given year. Yet, as noted, we are spending some 38% based on that same measure  (GDP) which positions revenues and expenditures in terms of the economic size of each economy. Not surprisingly, our accrued public debt now approaches $36.2 trillion which represents some 120% of our total economic activity. We have not seen such a debt level since the end of WWII. Just servicing this debt going forward would consume about 4% of our GDP. That, by the way, only covers the interest on our borrowing.

Not even the billionaire minions of the MAGA movement agree on the meaning of the debt question. Musk has recently spoken out against the megabill, citing extravagant additions to our annual deficits as his reason. Billionaire Peter Theil (Paypal and an early investor in Facebook) is more sanguine about the growing debt. He takes the more dynamic view that has been popularised by many conservative analyists. Our growing debt will not be a problem since continued tax breaks for the entrepreneurial classes (people like him) will enable the new economy based on AI to thrive and dominate with unrivaled efficiency. Just like the new economic thinking in the post WWII period (Keynsian concepts) drove our expansion then in ways that enabled us to absorb our massive war debt, our impending technical revolution will do the same now. So, keep borrowing, or so he believes.

Our economic history is littered with the sky is falling scenarios. Will the megabill be the straw that breaks the camels back? Will the tax breaks favoring the wealthy and exacerbating social inequality finally rip apart our social compact? Will foreign nations supplant America as the go-to currency in world trade, ending our dominance since WWII? Will other countries stop financing our debt by refusing to buy our bonds except at punitive interest rates? Will Trump’s childish antics in global trade and world affairs leave us isolated and a loser in the world’s  economy? So much can go wrong. Yet, the world remains a curious and mysterious place.

As the debate rages about the merits and demerits of Trump, MAGA, and the megabill, remember the need for perspective. Our government, by all standards is not bloated. It is not full of waste. It has not been overreaching or tyrannical until recently when those promising greater liberty actively sought to deprive us of such. By all comparative standards we were doing well except for one thing…paying our bills. In that respect, we permitted the uber wealthy to escape their obligations, thus permitting them to accumulate an historically disproportionate share of the income and wealth pies. In a little more than a single generation, perhaps two, the top 1 percent saw their share of income soar from less than 10 percent to almost one quarter of the total after 1980. That redistribution of wealth and power is now accelerating further under MAGA policies.

Still, predicting Armageddon or an imminent apocalypse remains an uncertain, if not foolish, undertaking. Nevertheless, the times remain unsettling. The megabill is structured to delay the worst pain (for average Americans) until after the 2026 midterms. Still, the pain will be felt even as the riches enjoyed by the elite continue to soar.

Even if the worst comes to pass, however, that may not lead to a reversal of the path we are on. Erosion of the social fabric, even larger and more demonstrative than seen across the nation on Trump’s birthday may evolve into direct forms of mass resistance. The response by MAGA? Perhaps it will be a call for emergency powers by the executive? Perhaps a declaration of a national emergency? Perhaps it will end with the termination of our constitutional protections enacted back in 1787? Perhaps we are talking about the establishment of full authoritarian rule in response to this crisis?

Wow, it all sounds hyperbolic and exaggerated. Perhaps I need some perspective. On the other hand,  perhaps I’m sounding an alarm that needs to be heard.