Patterns in Federal Spending
I’m puzzled by all the reports that Congress is spending too much. It turns out that from 1990 to 2005, spending didn’t rise as a fraction of the economy– it fell. Defense spending and interest payments fell drastically. Transfer payments rose substantially, but not quite as much. And the small “all other” category fell from 3.9% to 3.4% of GDP. Is porkbarrel spending really more of a problem now than then?
All these numbers are from Table 461 of the Statistical Abstract. From 1990 to 2001 to 2005 (estimated):
- Federal spending went from 21.8% of GDP to 18.6 to 20.3%
- National defense went from 5.2% of GDP to 3.0% to 3.8%.
- Payments to individuals (social security, medicare, medicaid, food stamps) went from 10.2% to 11.3% to 12.2%.
- Net interest went from 3.2% to 2.1% to 1.4%.
- “All other grants” and “All other” went from 3.9% to 2.7% to 3.4%.
Or, we can view the situation from 2001 to 2005. Over that period federal spending as a fraction of the economy did increase by 1.7% of GDP, and would have increased by 2.4% if interest payments hadn’t fallen. Increases in defense spending, “all other”, and transfers each made up about a third of that. And the increases in defense spending and “all other” are temporary, we may hope (porkbarrel projects have finite lives).