Posts Tagged ‘Government spending’
Government Diversion
Federal government spending has steadily increased from 14% of GDP in 1950 to about 25% today. Because of this, legislators and bureaucrats are increasingly lobbied in an effort to have them bestow government largess on one group or another. Unfortunately, this is a zero-sum game. Were government spending to decline, so would the importance of…
Read MoreGovernment Goes On!
If a continuing resolution is not passed by the Congress by 3/27/13, the Obama administration will be forced to shut down activities funded by appropriations and all non-essential government operations. But this isn’t that ominous. Only 40% of federal spending relies on appropriations and two-thirds of that is considered “essential” and thus will continue even…
Read MoreGDP = C+I+G+(X-M)
Q1 ’12 GDP was composed of personal consumption expenditures (C) totaling $11.0 trillion, private investment (I) of $2.0 trillion, government spending (G) of $3.0 trillion and net exports (E) of -$0.6 trillion. In Q2, G will be slightly lower, with E and I largely unchanged. So, overall GDP growth will be dependent on C. But…
Read MoreBigger Than You Think!
How big is the US welfare state? Bigger than you think! In Europe, governments subsidize industry, and provide healthcare and day-care, through high taxes. Here we do the same thing, but with special (charitable, medical) deductions, (childcare) tax credits and exemptions. Adding back these items (totaling $600 billion) increases government spending by 20%! This puts…
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