Robert Samuelson sums up the consequences:
For the past half-century, federal spending has averaged about 20 percent of GDP, federal taxes about 18 percent of GDP and the budget deficit 2 percent of GDP. The CBO’s projection for 2020 — which assumes the economy has returned to “full employment” — puts spending at 26 percent of GDP, taxes at a bit less than 19 percent of GDP and a deficit above 7 percent of GDP. Future spending and deficit figures continue to grow. What this means is that balancing the budget in 2020 would require a tax increase of almost 50 percent from the last half-century’s average.
It’s amazing that it’s still necessary to explain that increased spending and higher taxes is not the magic formula to increase societal wealth, the mad visions of neo-Keynesian economists notwithstanding. Obama/Soetoro’s decision to attempt taxing foreign profits at the second-highest corporate tax rate in the OECD will absolutely cause large corporations to abandon the USA. There’s no question about it. I drove through Switzerland recently and saw the billboards that McDonalds had put up throughout the country. The pictures of fries and sesame seeds in the shape of Switzerland effectively raised a middle finger to the UK, since the advertisements were announcing the relocation of McDonalds’s European headquarters that had formerly been based in London. And McDonalds is far from the only multinational fleeing the insane British tax regime for more reasonable quarters.