Economics

Federal Spending and GDP: Uh-oh, Here We Go

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A useful new chart from Cato's Chris Edwards:

To the moon!

NEXT: Battering Down the Great Firewall of China

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  1. They’re not called entitlements for nothing, you know.

  2. Math Problems: 61 percent of Obama’s deficit reductions purely hypothetical

    http://dailycaller.com/2010/02…..othetical/

  3. Excel? Really? Nobody at Cato has a prettier graph creation tool than that?

  4. The chart pretty much refutes the old trope of blaming deficits on Reagan’s military spending, doesn’t it?

    1. Don’t actually recall a rigorous running of the numbers but I remember someone suggesting that the biggest contributor to the debt in the Reagan era was interest on the debt itself.

      There was at least one of the high interest rate years had interest as one of the biggest budget items and pretty much as big as the deficit itself.

      We were in the position of borrowing money to pay the interest on our debt.

    2. Not really. According to the graph, during the Reagan years, nondefense declined and defense spending rose. Therefore, a rise in the deficit would have been powered by defense spending.

      1. Except that non-defense spending was nearly double defense spending, so most of that deficit was not due to defense spending.

  5. Tax and spend liberals should leave.

    Go to France or somewhere else where you will be happier.

    1. And where should spend and spend Republicans go?

      1. With the other tax and spenders.

      2. They can follow. Getting rid of the tax and spend liberals would be a good start.

    2. And don’t forget the borrow and spend Republicans…

  6. Looking at the generalized trend lines for nondefense spending and future interest payments, the conclusion is utterly inescapable: the Bismarckian Welfare State upon which most first world western countries today are based is a guaranteed failure, and doomed to collapse.

    I believe that figuring out what model is going to eventually replace this flawed system, and implementing the transition with the least possible amount of societal upheaval is going to be by far the biggest challenge of the 21st century for the serious intellectuals and leaders of our world.

    1. I believe that figuring out what model is going to eventually replace this flawed system, and implementing the transition with the least possible amount of societal upheaval is going to be by far the biggest challenge of the 21st century for the serious intellectuals and leaders of our world.

      I would imagine a complete collapse of the welfare state.

      It would not be a totally bad thing. If the state collapses, that means no more civil asset forfeitures.

  7. To the Moon, Alice!

  8. Total mandatory human resource programs (FY2001): $1,033,679 million
    Total mandatory human resource programs (FY2011): $2,173,579 million
    I blame Congress, not Bush.

  9. This is even more complicated when you consider that federal spending is part of the GDP figure.

    1. Why? They’re graphing the portion of GDP that is government spending…

      Granted, a chart showing the relationship between all these components and private sector spending over time, in inflation-adjusted dollars, might be enlightening, if only to provide some proof or disproof of Keynesian thinking.

  10. Look at that… hockey stick!

  11. Living on the moon with the MoNoStErEo.

  12. Defense spending rose during the Bush years from what three to five percent of GDP? Bush’s wars, whatever their merits, are not what is running us broke.

    1. That is true John…what’s trully destroying the united states? ENTITLEMENT! We could stop the war right now and we’re still in deep trouble..very deep trouble…so lets not blame it all in the war because there’s over $100 TRILLION dollars unfunded liability prior to those wars.

  13. I can hardly wait to see what that green line looks like when the prime rate cracks ten per cent.

    Wheeeeeee!

    1. That won’t be a problem because we will have 8% inflation to go with those rates. And soon a trillion dollars won’t seem like so much money.

      1. 8% inflation??

        Friggin’ optimists…..

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