About to burst: taxes and spending will soon go crazy.

TAXES are going to go up. That's not a prediction about what the Democratic Congress is going to do about President Bush's tax cuts. Even if they make all of those tax cuts permanent, taxes are still going to go up--automatically, with no vote by the Congress. Spending is going to go up, too--way up. Conservatives have no plan to solve these problems. They don't seem to be aware that the tax problem even exists.

The major reason taxes are going to go up is that our tax code gives the government a disproportionate share of the proceeds from economic growth. As the economy grows, people move into higher tax brackets. So average tax rates go up.

Actually, you don't even need to move into a higher tax bracket to end up paying higher average tax rates. Let's say we had a flat tax of 17 percent on all income above $15,000. Let's say you get a raise from $25,000 to $30,000. Before the raise, you paid $1,700 in taxes, 6.8 percent of your income. Afterward, you pay $2,550, or 8.5 percent.

This kind of "bracket creep" is more benign than the old kind. In the late 1970s, taxpayers found that inflation was putting them in higher tax brackets. Even when they were not making any more money in real terms, the government was taking more from them, thus leaving taxpayers poorer than they had been. One of President Reagan's major accomplishments on taxes was to make tax brackets automatically increase with inflation.

When raises, rather than inflation, fuel bracket creep, individual taxpayers still come out ahead. But the percentage that the government takes out of the economy creeps upward without a vote. In 2005, the Congressional Budget Office issued a report that touched on the subject: "Under current law, taxpayers will face higher rates, with detrimental consequences for work, saving and economic growth."

The more painful, inflation-driven variety of bracket creep hasn't completely gone away, either. Every year, more people are paying the Alternative Minimum Tax, originally designed to make sure that fat cats couldn't use tax breaks to wipe out all or most of their tax liability. If the regular tax code generated too low a tax liability, these rich taxpayers would have to pay the AMT instead. But the AMT does not take account of inflation or economic growth, so it counts more and more taxpayers among the rich. And so the government's tax take rises even more by the year.

Over the last 50 years, federal revenues as a share of the economy have been remarkably stable. They have ranged from 16.1 percent to 20.9 percent, and averaged 18.5 percent. Right now, they're at 18.4 percent. If the Bush tax cuts expire and brackets are allowed to keep creeping, however, taxes as a percent of GDP will rise to 23.7 percent by 2050. Never in American history--in war or peace--has the tax burden been so high.

The spending side of the story is more familiar. Social Security is the easiest example to understand. As wages grow in the economy, so do benefit levels. Someone who retires now after making an average U.S. income throughout his working life will get $15,400 in Social Security benefits this year. An average-wage worker who retires in 2050 is expected to get a first-year benefit of $22,200 (adjusted to today's dollars for inflation). Benefits, that is, are expected to rise 44 percent. Since the proportion of retirees will increase for decades, total spending on Social Security will go up even faster.

Medicare will grow faster still: Healthcare costs have outpaced the economy for decades. Put these trends on auto-pilot, and the federal government will become a program to send money from young people to old people. The federal government spends 4.2 percent of the country's yearly income on Medicare and Medicaid. Assume that the cost of those programs grows at its historical rate, and the federal government would have to devote 22 percent of the economy to paying for those two programs by 2050. That's a larger figure than the federal government spends today on everything it funds.

On both the spending and tax sides, then, the system is geared toward bigger government. The goalposts keep moving away from us. If conservatives propose that the Social Security benefits of 2040 be kept to today's levels plus inflation, liberals can accuse them, somewhat reasonably, of imposing "steep cuts"--44 percent cuts--in the program. To keep tax revenues stable as a share of the economy, conservatives would have to enact substantial tax cuts repeatedly. That's what we did during the last few decades, which is why federal revenues stayed roughly flat as a share of the economy despite bracket creep.

But now each tax cut is presented as a reckless, deficit-expanding departure from an assumed baseline of ever-rising revenues. The rising baseline for spending also makes tax cuts look more dangerous: If spending "obligations" are going to rise so much, the government will find it harder and harder to part with the money. In other words, Washington assumes it will get more and spend more as a matter of course.

People who follow the debates over fiscal policy closely will have run into the claim, from liberals, that "reversing the Bush tax cuts would fully pay for the Social Security shortfall." That is true only in a misleading technical sense. The Social Security system has IOUs from the rest of the government. The liberals who make this argument aren't counting those IOUs as part of the shortfall. But the government will still have to find some way to pay them off. More important, the argument doesn't assume that we go back to the level of federal revenues, as a share of GDP, that prevailed right before Bush's tax cuts. It assumes, rather, that we let bracket creep plus the reversal of those tax cuts carry us to historically unprecedented levels of taxation.

The problem I am describing is a political one, and thus something of a luxury: Wage growth is clearly preferable to wage stagnation, even if it leads to higher tax rates and Social Security payments. For conservatives, however, the political problem is likely to be quite severe.

A few conservatives have more or less explicitly surrendered to the spending trends. They say that the government has a moral obligation to meet all of its promises of future benefits, even if it does not seem to have the wherewithal to do so, and have tried to design various convoluted "conservative" plans to raise the money. These plans generally assume that mild free-market reforms can generate wealth sufficient to make up for gigantic shortfalls.

But there really is no good argument for tax and entitlement policies that generate constantly, mindlessly growing government. Fixing the tax side of the problem is conceptually easy. The Alternative Minimum Tax could be indexed for inflation or, better, scrapped. The regular tax code could be indexed not only for inflation but for economic growth. But the government is now so dependent on the assumption of quickly rising revenues that it would be enormously difficult to enact any such fixes. They would be much more "expensive" than the Bush tax cuts were.

Alternatively, you could try to impose uniformity: If tax brackets are going to be indexed to inflation alone, so too should spending programs. Social Security benefit levels could be made to rise with prices rather than with wages. That policy would eliminate the Social Security shortfall entirely. (It would be trickier to slow Medicare's growth the same way.)

In the real world, we're not likely to get a solution quite so clean. But it is worth keeping this background in mind when considering proposed deals, or the possibility of making a deal at all, on entitlements and taxes. Conservatives have generally been hostile to the idea of striking a deal with Democrats, because they know that a deal will probably involve tax increases. And it is true that a deal that causes taxes to rise even more than they already will is unlikely to be worth making. But we should also remember that the absence of a deal does not protect us from tax increases: It guarantees them. As things stand, conservatives are set to lose the political battles over limited government for the next generation, before they have even fired a shot.