Deficits are projected to permanently top one trillion dollars by 2021. And while the drivers of long-term spending growth come overwhelmingly from Medicare, Social Security, and net interest on the debt, a common claim is that defense spending is a bigger fiscal problem than entitlements because defense doesn’t have any dedicated revenue that helps offset its cost.

Actions have consequences, often unintended ones. When government policies carry unintended consequences, wreckage may follow. Take Prohibition, it didn’t stop drinking, but it did cause a massive drop in tax revenues while boosting organized crime. Or Smokey the Bear, the fire-suppression campaign led to the accumulation of dried timber and other fuels within our forests, fuels that have contributed to unprecedented wildfires. 

Last month, California governor Gavin Newsom announced that California’s ill-fated high-speed rail project would be scaled back enormously due to cost overruns and delays. The original project, which had an initial cost estimate of $33 billion, would have provided high-speed train service (speeds on some segments in excess of 200 miles per hour) beginning in San Diego, traveling through Los Angeles and the Central Valley up to the state capital of Sacramento, and would have also included the San Francisco Bay Area and Silicon Valley. With possible federal contributions, this idea sounded promising enough that nearly 53 percent of California taxpayers voted for a $9 billion bond in 2008 to help finance it.

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