September 29, 2010


A Million Here, a Million There ?: Why federal spending never goes down, and why that's not a problem. (Paul Waldman, September 28, 2010, American Prospect)

[H]istory demonstrates that the ideology of those who are constructing these budgets seems to have only the barest relationship to how big government gets. Spending went up when Ronald Reagan was president, and when Bill Clinton was president, and when George W. Bush was president. It went up when times were good, and it went up when times were bad. In fact, only once in the last 40 years has the federal budget in a given year been lower than what it had been the year before, even after inflation is taken into account.

Of course, conservatives believe this is exactly the problem. But it has been true in both Republican and Democratic administrations and with both Republican and Democratic Congresses.

There are some very good reasons why. First, our population keeps growing, by thousands every day, creating more demands on government. Second, the increasing complexity of modern life brings our society a steady stream of new challenges, some of which have to be met by government. Before the widespread adoption of the automobile, we didn't need an interstate highway system. But when that need became apparent, President Dwight Eisenhower stepped up and spent the money. Those roads then needed to be maintained. That meant more government spending -- spending that virtually no one thinks wasn't a good idea.

Another reason spending keeps increasing is that both parties have types of spending that they would like to see continue to climb. For instance, Republican members of Congress don't think defense spending should ever be reduced; in other words, we should always spend more than we did the year before forever and ever. And we certainly do; according to White House budget documents, we spent $636 billion on the Department of Defense in 2009, we're spending $688 billion in 2010, and we'll spend $718 billion in 2011. That doesn't even include the Homeland Security budget or the military costs spread around other departments like the Department of Energy. [...]

Our government is still much smaller than those of other countries in what we used to call the First World. As these data from the Organization for Economic Cooperation and Development show, only a few developed countries spend less than we do on our government (the data combine federal, state, and local government):

Our federal spending has increased by a few points in the last two years (from 20.7 percent of gross domestic product in 2008 to 24.7 percent in 2009), but it is still small compared to that of our friends in Europe. Of course, that doesn't tell us what the optimal level of government is. Perhaps you believe that the French or Swedes or Danes, with a public sector about 50 percent larger than ours, are terribly oppressed by their governments. It's hard, though, to argue seriously that an increase of 4 percentage points of GDP takes us from blessed capitalism to dystopian statist nightmare.

Posted by Orrin Judd at September 29, 2010 5:15 AM
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