Wintercow Hits a Homerun.

Where Did it All Go?
Jul 15th, 2011 by wintercow20
The following bar chart demonstrates the spending levels of the various federal agencies between 2006 and last year. Over that time, federal expenditures increased from $2.66 trillion to $3.72 trillion, an increase of over 40%. During this time period, prices rose by about 8% and population rose by about 3.5%, so in real per capita terms, over a mere 5 year period federal government spending per capita has increased by over 28%. This is larger than real median family income increased over the preceding 30 years.



Percent Changes on the Right, All Figures Nominal

The red bars indicate current spending levels while the green ones indicate past spending levels. Does anyone at all, in Congress, in the press, on the street, in the academy, ever look at this picture and ask where it all went? How can it be possible for spending to have increased by over 28% in real per capita terms, but now all kinds of federal agencies and programs are experiencing … a … crunch? You’d think you were being put on Candid Camera with this sort of rhetoric.

And consider this, even with the “grand budget deal” that would have spending slashed … slashed! by $2 trillion over 10 years, that means we’d be reducing spending from $3.7 trillion (using the latest year as an illustration) to a “mere” $3.5 trillion, still a mountain of spending beyond what prevailed a few years ago (about a 20% real increase per capita). If I asked you the following how would you answer: “your real per capita spending will increase by 20% over the next five years, would you characterize that as a crisis? Would your roof shingles begin to fall off? Would you have to do without heating your home? Would you have to stop purchasing things at Amazon? Of course not. Real per capita increases mean spending over and above what you are currently able to do.

How is it possible to be spending over a trillion dollars more today than five years ago and for anyone to be claiming we are in a crunch? Certainly with the lagging revenues we have a deficit issue, but I urge you to be aware of the rhetoric that makes a deficit problem appear to be like one where agencies cannot somehow afford to do the things they did just a couple of years ago.

And allow me to ask, can some “progressive” who wants even more spending and taxes please point out a year when spending levels were appropriate? And would you kindly do me the favor of comparing how the agencies performed and how our “vital” infrastructure was doing when spending was at those levels? And then can you again answer my question, what the heck has the government done with all of the new money that has been spent since that nirvana?

The University of Rochester's Michael Rizzo posts here.