Keep your eye on one thing and one thing only: how much government is spending, because that’s the true tax.

The Hidden Tax of Government Spending

Most of us think we pay taxes once a year when we file returns. But Friedman is pointing at something sneakier: government spending is a tax whether we see the bill directly or not. When the government spends money it doesn't have, it either borrows (which means future taxes or inflation), prints it (which erodes what's in your wallet), or raises rates explicitly. The money has to come from somewhere, and that somewhere is always us.

This matters because government budgets feel abstract—just numbers in the news—while a tax bill feels real and immediate. We notice a wage deduction instantly but barely register how inflation nibbles away at savings or how our dollars buy less over time. Friedman's point cuts through that fog: if you want to understand the true cost of government, stop looking at tax rates and start looking at spending totals. A politician can cut your income tax while doubling spending, and you're not actually winning.

The twist is that this makes you rethink what "fiscal responsibility" actually means. It's not about feeling virtuous that taxes stayed low—it's about whether government is living within its means. That's a harder question to answer and a less comforting one to sit with, which is probably why most voters don't ask it often enough.