And if we look at the deficit in terms of GDP, we find that the 2013 deficit was just 3.6% of 2012 GDP. As of now, 2013 GDP numbers, though more impressive than the 2012 reading, aren't yet out. But the fact is that the deficit, in relative terms, is just one-third the size of the deficit in 2009. And it's nearly half the size of the deficit in calendar year 2012.
Also notable are higher taxes. Before 2013, dividends and capital gains were taxed at just 15%. Now, high-income earners may pay as much as 23.8%. This has an incredible effect on government revenue, as high-income earners who earn the majority of their income from investments paid tax rates that were nearly 40% higher than they paid the year prior. Suffice it to say that there are many unhappy hedge fund and private equity managers who are now paying 23.8% on their earnings, instead of a low 15% capital gains tax rate.