Tuesday, August 05, 2008

A reality check

Greg Sisk at Mirror of Justice collects some interesting statistics on governemnt spending and, in particular, on government spending on social programs. Essentially - and this is nothing new - it turns out that the trend in social spending as a percentage of national income has moved steadily upward while spending on defense has moved steadily downward. Government spending consumes 35.9% of gross domestic product and taxes are the largest single expenditure for the average taxpayer.

Of course, this doesn't tell us what the optimum amount of government spending ought to be and it is important to note that social spending, as he has defined, is not limited to spending on poor people. Welfare spending, which does not include all spending on the poor, seems to have increased from about 2% of GDP in 1960 to 4.4% in 2007 and then declined to around 3% in 2007. On the other hand, the poverty rate has been, roughly, cut in half during that same period. Although all of that reduction seems to have been achieved by 1973 (and most of that, incidentally, before the impact of Great Society programs) and has been stubborn since then (it's actually a bit higher today), the rate of poverty now seems to respond - within a fairly narrow band - to economic growth.

Sisk's point, and mine, is that reality belies some of the overwrought rhetoric about the United States being a "mean" nation and the conservative ascendency having starved public programs. Perhaps we ought to spend more but its not because we have been spending less.

1 comment:

Brew City Brawler said...

Not sure what you mean by "Great Society" programs (War on Poverty programs actually were relatively small potatoes.But I'd be interested to know what impact Medicare (hospitalization could push people who were struggling into outright poverty and I'm assuming Medicaid recipients fall into the "poverty" definition in the chart, tho could be wrong) and allowing 60 year old widows to receive benefits (1965) had on the post-1965 decline in poverty rate.