Thursday, January 17, 2013

Some charts to make your hair curl... and what we can do about them...

From Greg Richards at in The Obama Hat Trick: Three Hockey Sticks

While the solution to cutting spending is going to be tough, our spending problem is not hard to understand.  Chart I shows federal spending as a percent of GDP from the Eisenhower administration through estimated numbers for fiscal 2012, which ended in September.  The Eisenhower administration is a good starting point for post-war budgets because it is the first period of budgetary normality following World War II, demobilization, and the Korean War.  Spending as a percent of GDP gives a crisp number which is comparable over long periods of time.

...Want to see something that will curl your hair?  Chart II shows federal borrowing as a percentage of the federal tax revenues, meaning how much borrowing we are doing each year as compared to how much revenue we are raising from taxes.


...Want to see the effect of all this spending?  Chart III shows the increase in gross federal debt (there is another calculation for federal debt, netting out the Social Security Trust Fund, which the government calls "debt held by the public," but we are not using that here).

Read it all here ...

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