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The Misguided 18 Percent Budget Solution

Dec. 6 (Bloomberg) -- Since 1950, federal revenue has averaged about 18 percent of gross domestic product -- 17.8 percent of GDP, to be exact. A neat bit of trivia, but who cares?

Lots of people, it seems. Republicans on the House Budget Committee, in a news release titled “The Impact of Looming Tax Increases,” emphasize that “federal revenue rose to 18.5 percent of gross domestic product in fiscal year 2007, well above the 50-year historical average of 18 percent.” This proves, they say, that “tax relief did not cause today’s deficits.”