There's a lot in the press today about CBO's latest report on the budget.  The media will be reporting that it shows a cumulative ten-year deficit of $7.1 trillion, which will increase the national debt by about 50% (from $14 to $21 trillion).

All that is true as far as it goes.

But it ignores the real story, as we shall see.  A deficit (or, cumulatively, the debt) is a fairly uninteresting number which is the difference between two interesting numbers--total taxes, and total spending.

Clearly, the deficit is problematic.  But that's like saying a car accident is problematic without identifying who is at fault.  A deficit takes two to tango, so where does the blame lay here--spending, or taxes?

Looking at the tax side of the equation, tax revenues are scheduled to rise from 17.7 percent of GDP in 2009 to 20.3 percent in 2019. 

Still not convinced spending is at fault?  According to CBO, the average federal tax take since 1960 is about 18.5 percent of GDP.  Taxes are already scheduled to be well above that by the end of the window.  Clearly, by any measure, America does not have an undertaxing problem.

So, taxes are going up (even after inflation, population growth, etc.)  But spending is going up at an even faster clip.  In fact, if spending simply grew with the economy from 2008 levels, the budget would nearly be in balance by the end of the period.  It isn't, because spending is completely out of control.  Spending grows from 21.1 percent of GDP in 2008 to 23.6 percent in 2019.  The long-run average for spending is closer to 20 percent of GDP.

If the deficit makes you uncomfortable, there's only one place to assign blame--the government spends too much.