Government Spending

John Merline on the "Austerity Myth"

|

Marrowing

How can Rep. Ron Paul (R-Texas) propose a $1 trillion federal budget cut when we've already cut to the bone? Over at Investor's Business Daily, John Merline provides some important context and charts:

[D]ata released by the Treasury Department on Friday show that, so far, there hasn't been any spending cuts at all.

In fact, in the first nine months of this year, federal spending was $120 billion higher than in the same period in 2010, the data show. That's an increase of almost 5%. And deficits during this time were $23.5 billion higher. […]

Nor does the claim that state governments sharply cut spending stand up well to closer scrutiny.

Overall state spending continued to climb right through the recession, when all money from state general funds and other funds, federal grants and state bonds is combined.

Total state spending in 2010 was almost 10% higher than in 2008, according to the National Association of State Budget Officers' annual State Expenditure Report.

And general fund spending — which makes up about 40% of total state spending — is expected to climb 5.2% this year and 2.6% next year, according to the association's latest survey.

Whole thing, including some collected scare-quotes about alleged austerity, here; link via Drudge. Peter Suderman wrote about the austerity myth last month.

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of Reason.com or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

27 responses to “John Merline on the "Austerity Myth"

  1. Wow, never would have guessed this.

    This is today’s Dog Bites Man Cop Shoots Dog story, isn’t it?

    1. I think you mean “dog shoots cop” there.

  2. Another data point for the believers of the “government spending creates recovery” myth to ignore.

    1. Agreed. If *ALL” government spending stimulates the economy, we should be experiencing the biggest boom in history.

  3. How many times do we have to point this out?

    A “cut” means spending less than we wanted to.

    1. Unless you use the magic words “let me be clear” it won’t work.

  4. I am a long-time libertarian, and supporter of this publication. But I can tell you that funding to my university was cut by roughly ten percent this fiscal year, resulting in actual firings, at high levels (the computing division in which I work lost four directors, two of whom were close friends of mine). So it may well be that some units did not have actual budget cuts but the one I work for certainly did.

    1. They love, love, love to cut things like education and libraries, just to freak people out. What’s significant when that happens is what they choose not to cut before screwing over “the children.”

      1. First they came for the educators, then they came for the firefighters, then they came for the police force . . .

      2. Rule #1: Cut the stuff that twitter-using students use.

    2. yes, because they wanted to spend more on other things, like solyndra.

      1. I can guarantee Solyndra was not a budget line item since it was a loan guarantee. The payout is an “emergency” expense.

        1. Where can I cash in your guarantee? Because I can point you to the appropriation for the purpose of guaranteeing the Solyndra loan.

    3. Who weeps for Geoff?

    4. Meanwhile in Uganda, Iraq, Afghanistan, Libya, Yemen, South Korea, Japan, Germany…

      Don’t worry their salaries are being put to good use.

    5. You’re committing the same fallacy that the Coke and Pepsi parties do: that the current baseline spending has always been this way and therefore no spending cuts below the current level can ever be undertaken.

      Take a look at your school’s previous 10 years of budgets and see whether or not these positions should have ever existed in the first place. I’ll bet you a sawbuck that they experienced exponential growth every year.

      1. Of course they didn’t exist ten years ago (or twelve, actually). In the nineties (and before) there were no course management systems (Blackboard, for example) and wireless access points that universities had to maintain in order to retain students. And faculty. And it was the people responsible for the maintenance of that stuff who were fired, and their work assigned to those who were left (including me).

        Not to mention all the federal reporting requirements that the IT unit supports. I’m not saying I think that universities should be immune from budget cuts–I’m just saying they actually happened, at least in the cases where I actually know the facts.

        1. But, does that mean that overall state spending was cut? They could have cut the school’s budget for reasons ProL laid out or just to featherbed the rest of the state’s budget.

          Who are we kidding? We know it went to the football program.

  5. funding to my university was cut by roughly ten percent this fiscal year, resulting in actual firings, at high levels

    But those perky new Assistant Trainers will reel in alumni contributions!

  6. The article misses the point. It’s that we thought we were going to spend so much more. So, it’s been cut.

  7. Of course they didn’t exist ten years ago (or twelve, actually). In the nineties (and before) there were no course management systems (Blackboard, for example) and wireless access points that universities had to maintain in order to retain students. And faculty.

    This is why I object to across the board percentage cuts. Priorities change. Levels of productivity change.

    Imagine if the GAO’s budget line item for “data entry clerks” was frozen at 1966 level in terms of percentage of staff. I suspect (even for government accounting systems) most of that information makes its way into the system without somebody sitting at a desk with a giant stack of paper invoices in front of them, tappity-tapping on a computer terminal.

  8. Instead of reading the words, it is interesting to look at the actual numbers.

    From 2000-2009, the spending almost doubled from $1.8 to $3.5 trillion. From 2009 to 2011, spending rose by 2.7%. If you take into inflation and population growth, per capita real-spending has slightly declined. Since 2009 was mostly Bush’s responsibility (fiscal year ended in September 2009), it would not be hard to make the argument that Obama has been fiscally responsible. More realistically, Obama has been less fiscally irresponsible than Bush.

    1. And your point is what? Nobody here gives a shit about Dubya.

      1. He thinks this is a TEAM RED place. Despite, you know, the orange everywhere.

    2. Until you consider the foul military budget (Help me out here, Panetta) — remember the “hidden” part.

Please to post comments

Comments are closed.