Government Spending Past & Present
Kurt Brouwer April 6th, 2009
My older son, Elijah, needed information on government spending for a project on which he was working. So, like a good Dad, I’ve had my eye out for a nice chart that lays this out.
This information is from a comprehensive report — Citizens’ Guide 2009 — on government spending and debt put out by the Peter G. Peterson Foundation. It is well worth reading.
These pie charts demonstrate the change in Federal government spending over the past 40 years.
Source: Peter G. Peterson Foundation
The report makes this point in terms of this chart:
Since the 1960s, the decline in defense spending as a share of the budget and as a share of GDP has been offset by the growth in the major entitlements (Social Security, Medicare and Medicaid) and other mandatory spending (agriculture subsidies, unemployment benefits, student loans, and civilian and military pensions and health benefits). In 2008, defense was 21 percent of the budget including the cost of operations in Iraq and Afghanistan and the war on terrorism…
I think reasonable people can agree or disagree with the changed nature of government spending over the past few decades. However, no matter what position we take, we need to think how about what these changes mean for us today as well as for our country in another 40 years.
Some spending is locked in once you make the commitment. For example, if we decide to increase Social Security benefits, then that will get locked in and future budgets will have that much less wiggle room to deal with future revenue shortfalls.
The reason it gets locked in is that no politicians wants to be the one to campaign on a pledge to cut Social Security. That does not mean we should not make such a commitment, but rather it means we have limited means and money locked in to one program is unavailable for another. It also means that government spending programs are easy to start and very hard to stop.
Hat tip: Willisms Blog
- Economy , Geopolitics , Money , income taxes
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Kurt,
Good lord, you haven’t been taken by the Petersen Foundation, have you. Consider this. Why did they shoose the year 1968 for comparison? Could it be that that was the peak year of the Vietnam War and that in turn was perhaps the peak year of postwar defense expenditures as a percent of GDP? This is a classic example of a carefully constructed biased statistical argument.
Now Mark. As I said, I found the chart because I was helping my son. And, I also pointed out that there were reasonable differences about spending priorities.
Sorry Kurt,
Did I tell you my knickname in high school was Sadistic?
No you didn’t. Now I understand and I’ll bear that in mind.
Zen riddle:
Whats the sound of chops being busted?
Joking aside, thanks to Kurt, Steve and Susan and Anne and the people at
BJ’s.
Anyone who has survived this past year in finance needs to pour a full glass and drink L’Chaim…no matter what background you’re from.
There is a lesson about Pesach that is good psychology, whether one is Jewish or not: Pesach was celebrated for hundreds of years, despite persecution, poverty, famine, and plague, at times when people’s hearts were in their boots.
No matter how dire one’s circumstances, one had to find a pretext to sit down and celebrate with family, and if possible, bring in a non family member who was far from home that night.
It may be that the rabbis (street wise psychologists), understood that if one goes too long without celebration, one forgets how to celebrate–like muscles that atrophy when one has been bedridden for too long.
Because if sharing pleasure is deferred for too long, one loses capacity for enjoyment when better times do return.
DB — very good points. Sharing good times with family and friends — plus the neighbor far from home — what could be better? This is particularly true doing tough times. The old wisdom of the rabbis is not to be scoffed at. In all our modern mania for Facebook and Twitter and everything else online, it’s important to take time off to nurture our human capacity for enjoyment.