J.D. Tuccille:

If a picture is worth a thousand words, how many detailed economic warnings does it equal? Or maybe there’s just one word that matters, and that word is “unsustainable,” which is how the Congressional Budget Office (CBO) has long described the federal government’s spending habits. Through years of failing to draw the attention of presidents and lawmakers with its publications, the CBO has now clearly illustrated the looming fiscal catastrophe with pretty pictures that even elected officials poised to double down on their extended spending spree might understand.

Published April 30, The Federal Budget in Fiscal Year 2020: An Infographic shows, in colored charts and graphs, the massive gap between what the United States government can afford to spend, and what it actually spends. “Revenues, $3.4 trillion,” reads the caption for a bar representing 2020’s take, “Outlays, $6.6 trillion,” reads the caption for its partner.

Daringly venturing to further test the comprehension of denizens of the Capitol and the White House, another pair of charts points out that $3.4 trillion in revenues represents 16.3 percent of GDP, while $6.6 trillion in outlays is 31.2 percent of GDP. What was spent by the federal government, in other words, adds up to almost a third of the entire economy and almost double what was collected in taxes.

But 2020 was a very special year, just as elected officials themselves often seem quite special. Perhaps the demands of the year justified a deviation from a tradition of fiscal restraint? Well, not so much, more illustrations attest. As one graph points out, the federal government has consistently spent more than it takes in for at least 50 years, with the exception of a brief period ending in 2001. “To fund government spending in years of deficits, the Treasury borrows from individuals, businesses, the Federal Reserve, and other Countries,” the infographic helpfully notes. The result has been a growing accumulation of debt until it equals the size of the entire United States economy.

Spending more than you make, year after year, and running up debt would seem to be … unsustainable. And that, of course, is just how the CBO describes such spending habits.

“[F]inancing a large and permanent increase in government spending through perpetual borrowing without any corresponding adjustment in spending or revenues at some point in the future is unsustainable,” CBO warned in March in response to ongoing moves to expand the size of government.

“[O]ver the long term, changes in fiscal policy must be made to address the budget situation, because our debt is growing on an unsustainable path,” CBO Director Phillip L. Swagel told the House Budget Committee in January 2020, before “emergency” pandemic spending.

“Debt is on an unsustainable course in CBO’s projections,” then-CBO Director Keith Hall advised a gathering of business economists in February 2019. “To put it on a sustainable one, lawmakers will have to make significant changes to tax and spending policies—making revenues larger than they would be under current law, making spending for large benefit programs smaller than it would be under current law, or adopting some combination of those approaches.”

“[E]ven with federal spending for all programs other than Social Security and the major health care programs on track to reach its smallest share of GDP since at least 1940, federal debt remains on an unsustainable path,” then-CBO Director Doug Elmendorf cautioned a macroeconomic policy conference in 2014.

But the federal government hasn’t deviated from its spending habits through all of these years, holding to an unsustainable path of spending far outstripping revenues. So, what are the likely consequences?

“A large and continuously growing federal debt would increase the chance of a fiscal crisis in the United States,” Hall told the Senate Budget Committee in 2017.

“If federal debt as a percentage of GDP continued to rise at the pace that CBO projects it would under current law, the economy would be affected in two significant ways,” the CBO noted in January 2020, before the massive expenditures of the past year. “That growing debt would dampen economic output over time” and “Rising interest costs associated with that debt would increase interest payments to foreign debt holders and thus reduce the income of U.S. households by increasing amounts.”

That is, running up debt acts as a dead weight on the economy, becoming ever-more expensive to sustain while making people poorer. But not all approaches to balancing expenditures and revenues are created equal: raising taxes to the sky-high level required to pay for politicians’ increasingly grandiose spending schemes would have nasty consequences, too. That’s because siphoning money from Americans’ pockets to pay for elected officials’ pipe dreams would leave people with less to save, spend, invest, and use to build prosperity.

“The general finding is that increasing taxes leads to lower GDP and personal consumption,” the Congressional Budget Office warned in March of the consequences of higher taxes to finance increased government expenditures. “After 10 years, the level of GDP by 2030 is between 3 percent and 10 percent lower than it would be without the increase in expenditures and revenues.”

There really are limits to how much governments can spend without inflicting pain on the people suffering under their mismanagement. Not that the people elected to Congress and the White House have shown any signs of comprehension or concern.

Given that these are people capable of running for public office without feeling any apparent sense of shame, is it possible that they’re just too stupid to understand our reports? you can imagine CBO economists asking one another as they tossed around the idea for the recent infographic. Does anybody have any crayons?

And so we end up with pretty pictures illustrating a very unattractive fiscal situation. Maybe drawings can finally deter elected officials from their outrageous spending habits where detailed reports have failed to attract their attention.

Lexington of The Economist:

One of the few uplifting notes of last year’s election season was struck by the candidates for Utah’s governorship. “Win or lose, in Utah, we work together,” said Christopher Peterson, the Democrat, in a humorous ad featuring him and his Republican opponent. “So let’s show the country that there’s a better way,” said that rival, Spencer Cox.

Now Utah’s governor, Mr Cox seems to be keeping his pledge. The upbeat 45-year-old is winning plaudits for his pragmatism and evenhandedness. After Utah’s Republican legislature demanded an early end to its mask mandate, he negotiated a month-long extension, with exceptions for schools and businesses. He issued his first veto of a bill sponsored by his brother-in-law (it was an attack on social-media firms and probably unconstitutional).

He is popular with Democrats as well as Republicans—as Utah’s governors tend to be. Gary Herbert and Jon Huntsman had similar records. Though Utah is one of the most conservative states, the relative moderation of its Republican leaders has helped make it one of the less polarised. “We have a history here of wanting to bring the other side to the table,” says Mr Cox.

An illustration of that was a deal between gay-rights and religious-liberties activists known as the Utah compromise. A textbook legislative trade-off, which recognised the rights of gays in employment and housing while permitting churches not to marry them, it has been cited approvingly by both sides in a budding row over Joe Biden’s support for new lgbt protections.

Another sign that Utah conservatives are different is their aversion to Donald Trump. The former president did better in the state last year than he did in 2016; but worse than any other Republican candidate in a two-horse race since Barry Goldwater in 1964.Though some leading Utah conservatives have warmed to him—including Senator Mike Lee—Mr Cox is among the many who remain opposed to Mr Trump and his grievance politics. “We’ve created something that we used to criticise, the victim culture that now exists on the right,” said the governor, more in sadness than anger.

The results of Utah’s functional conservatism are impressive. The state is as welcoming to immigrants as it is to investors—and one of the fastest-growing in both population and output. The main explanation for it is signified by the needle-like spires that pierce the Salt Lake City skyline. Over 60% of Utahns, and a bigger majority of Utah Republicans, are Mormons. This makes them members of a church imbued with little of the pessimism evident elsewhere on the religious right. To the contrary, where white evangelicals—the Republicans’ biggest constituency—harbour the wounded sense of entitlement of a group hurtling from cultural primacy to the margins, Mormons exude the confidence of a once reviled but now thriving minority. Founded in upstate New York in 1830, by a 24-year-old visionary called Joseph Smith, their religion is one of the world’s richest and fastest-growing. It claims to have almost 17m members in 160 countries.

The church, to which most Utah Republicans belong, is deeply conservative yet sometimes adaptable. It was behind the Utah compromise, a concession that ended up reaffirming some of its architects’ Mormon faith. “If you’re a true Christian, you want to love your neighbour.” concluded the leader of Utah’s Senate, Stuart Adams, who had previously opposed gay rights.

Sadly, a comparison between the Mormon and evangelical churches also suggests how hard it will be for evangelicals to follow the Latter-day Saints’ lead. The big difference between the two is psychological and rooted in their divergent histories. “My great-great-great-grandparents’ home was burned to the ground by a mob in Illinois,” said Mr Cox. “You don’t forget stuff like that.” That past not only explains Utah’s openness to immigration. It represents for Mormons a parable of existence as a sacred struggle, demanding humility and accommodation with a hostile world. Unlike aggrieved evangelicals, says Richard Mouw, a leading evangelical theologian, “Mormons are not angry, they don’t want to win, they just want a place at the American table.”

Mormons’ and evangelicals’ distinct perspectives are also a product of their churches’ organisation. The decentralised nature of evangelical America has allowed worshippers to sort themselves into racially and otherwise homogeneous congregations. This has in turn led them to elevate cultural over spiritual concerns. By contrast, Mormons’ centralised institutions underpin their greater pragmatism and openness to diversity.

They must worship at their local church and are urged to provide alms and other support to poorer neighbours. This helps explain why Utah has the lowest wealth inequality of any state. It also promotes empathy over righteousness; the church’s missionary tradition does the same. To that end, Mr Cox did a stint in Mexico; Mitt Romney in France. And this structure is overseen by one of America’s tightest, and more enlightened, church hierarchies.

Senior Mormons are considered to be “prophets, seers and revelators”. The current ruling trio were formerly a pioneering surgeon, a justice of Utah’s Supreme Court and a Stanford business professor. Their example in getting promptly inoculated against covid-19 helps explain why Mormons, who tend to be more observant than white evangelicals, are also likelier to get vaccinated.

Saints alive

For the literary critic Harold Bloom, a fan of Mormonism, it was the “authentic version of the American religion … [which] yet may prove decisive for the nation”. Something similar could be said for the pragmatic politics the church endorses.

Utah conservatism is a reminder to the American right of its more expansive, optimistic past. It also offers a warning of where Republicans’ current pessimistic course may lead. Almost half of Mormons under the age of 40 voted for Joe Biden.

What’s ironic about this? Most people hostile to religion would use words like “oppressive” to describe Utah and the Mormon faith. Mormons do not drink alcohol or coffee. Mormons were accused of racism because of their lack of non-white leaders until the late 1970s. Women do not have the same roles in the church that men do. So it’s a little unusual for the liberals to suddenly consider Utah an exemplar of how to get along with each other. (My last trip to Utah in 1999 made me describe the state as “pathologically polite.”)

As far as Utah Republicans being “moderates” (whatever that means anymore), Utah’s state government, whether run by Republicans or Democrats, seems to be smaller than, say, the leviathan of Wisconsin. Utah placed eighth on the Tax Foundation’s State Business Tax Climate list. Wisconsin is 25th. (Higher is better in that comparison.) In state and local tax burden, Wisconsin ranked 14th (as in 14th from the largest); Utah was 30th. Regardless of the map …

… Wisconsin has higher taxes and bigger government than Utah does. And the bigger government is, the bigger the stakes in elections, therefore the less incentive to get along with the opposition.

I am a little curious as to what prompted The Economist to even look at Utah, except to stick it to Trump fans, perhaps. I’m not Mormon, but I’m also not evangelical, so I can’t say which is “optimistic” and which is “pessimistic.” But if you’re optimistic about the future of this country, you’re deluding yourself.