Home > Politics and the economy > US federal spending facts (2 graphs)

US federal spending facts (2 graphs)

from Peter Radford

Like many people I am perplexed by claims that federal spending has ‘exploded’ on Obama’s watch. The claim is generally made by someone on the right of center in politics and is stated as if it is a well known fact. So well known that no one can possibly refute it. The conversation is then meant to proceed immediately to what we can do about said ‘explosion’ and how we can restrain the Federal government.

The problem I have is factual.

Here is a chart of Federal spending from way back when:

Yes, spending has risen substantially through the years, but take a closer look. Let’s inspect that past decade:

Now the picture is somewhat different.

Instead of spending ‘exploding under Obama, it has been under control. The explosion, such as there is, took place under George W Bush. There was a sharp upward shift when the recession hit and safety net spending took off, but since then the trajectory has been fairly flat. Spending is clearly higher now than when Obama took office, but most of that increase occurred in the midst of crisis. There is no sign of the mythic explosion right wingers like to talk about.

So why do they? And where do they get their facts?

The first question is easy to answer.

Right wingers want there to have been an explosion because it allows them to argue for draconian cuts, especially in social programs. So inside their world the chatter is about a burst of spending that requires urgent cutting back. This is despite, as the charts show, that there has been no such burst. The ideologically pure position on the right, nowadays, is that government spending is way out of control and, that if left unattended, it will throttle the economy. Apparently runaway government spending is now a problem whereas during the Bush era it was not.

For the record: during the first four years of the Bush administration spending rose a cumulative 30%. In Obama’s first term it rose just 9%.

There is something extremely odd about this. The same folks in the Republican party who, presumably, felt fine with a 30% increase in four years, now think it is outrageous to have a 9% increase over the same timeframe.

That is absurd and hypocritical.

It would be reasonable to have objected to both. It is not reasonable under any circumstances to take the position we see today.

That second question is impossible to answer.

I have no idea where they get their facts. I have seen some right wingers claim spending has risen 37% under Obama. I cannot find such numbers. Not, at least, in any of the major databases of governments statistics. Perhaps they made it up. If so, it makes sense that the made up figure tops the Bush profligacy.

In any case, it simply isn’t true that federal spending has exploded.

Our annual budget deficit has grown sharply, not because spending grew, but because revenues slumped. That annual tax take shrank, as it always does in recessions, and it will recover in due time as the economy recovers.

We have no great immediate fiscal crisis. None.

That may be inconvenient to those who wish we did so that we would be forced to slash social spending. But the facts don’t lie.

Not the real facts at least.

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  1. February 13, 2013 at 4:50 pm

    Nice story, but wrong graph, the one that has meaning looks like this http://bit.ly/YXourY I put the same fed data into a Fusion table so you can focus in on areas you like. In the blue area at the bottom of the table you can pull in the sides to focus the data, and in so doing, if you focus on the 2008 period and beyond, you see that the economy continues to under perform. This loss of business activity rolls up to over $288 billion per month of forgone business ($57 billion per month in forgone tax revenue). To be candid, I don’t see how anything else matters. This economy is unhappy and unwell, there is a malady upon it based on naive well intended and arrogant governmental activities.

    • nyambol
      February 13, 2013 at 5:37 pm

      In rhetoric, this is called, “shifting the grounds of the argument.” You didn’t like the presentation, so you made up a completely different one and claimed it was more important, thus justifying ignoring the original. The linked presentation does not deal with the question of the “fiscal crisis.” You’re free to claim that your ideas are more important than Radford’s; readers are free to decide you’re wrong.

      At any rate, your theorizing is about to get an empirical test. If, as expected, the so-called sequester kicks in on March 1, there will be massive reductions in government spending and lay-offs to match. If your theory is correct, we should see a huge economic boom resulting from the twin whammy of “smaller gov’t” and “reduced deficit spending.” If, however, as most economists are predicting, the economy tanks, then your theory is empirically busted and, we can expect, you will cease to propound it.

      • February 13, 2013 at 6:16 pm

        Indeed, I liked Radford’s comments and have no doubt they’re correct, still there remains the malady affecting the economy suppressing full economic activity. I don’t buy the implied notion that somehow when government takes money and spends it we receive some form of economic dividend as if when the government spends a dollar there is a dollar and twenty cents of value. As I struggle monthly to meet payroll the subtle differences in Bush expenditures vs Obama’s have little meaning. We seldom think of Oxygen until we’re deprived of it, then quickly it becomes the only thing we think of. The economy is being water-boarded by whimsical, ambiguous policies, ideas, regulations and taxes affording little guys like me, precious little time for theory. All I’m asking is for government to take it’s foot off the air-hose.

        Still I very much enjoy the education this site and comments like yours provide me and I thought those Google Fusion graphs are cool as well.

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