I'm having an argument over at Alas (a blog) about trends in government spending over time, in particular spending on social services. Ampersand, the blog's owner, in a post called "Government spending is not up, up, up", claims that government spending has been nearly flat for almost four decades, and defends a commenter's description of the US social system as having been "starved, looted, privatized, and starved some more---pretty much steadily over the last two or three decades."
This has prompted me to do something I've been meaning to do ever since I took the dark oath that secured my place as a Catallarchist: Make charts, and lots of them. There's a lot of material to cover, so I'm going to do this as a series of posts. Today I'll discuss trends in total government spending. All data are from the Economic Report of the President, unless otherwise specified.
Ampersand is basing his claim that government spending has been relatively flat since 1968 on the fact that spending as a percent of GDP hasn't changed much over the last 20-30 years. The chart on the right (click to enlarge) shows spending as a percentage of GDP, broken down into Federal spending, state spending, and federal grants to states (not double-counted). While one could argue that spending as a percentage of GDP hasn't really gone anywhere since 1980, and even then only because of the (possibly anomalous) decline in the '90s, it's a bit of a stretch to say that it's been flat since 1968.
All of this is beside the point, though, partly because percentage of GDP is the wrong metric to use. If we were discussing the extent to which government spending burdens the economy, this would be a good metric to use (and it's worth noting that government actually isn't consuming a rapidly-increasing share of the economy). But to determine whether or not social programs are being "starved" and "looted" (not that there's anything wrong with that), real per-capita spending is a better metric. As a country grows wealthier, it should be possible to provide a constant level of government services with a smaller and smaller percentage of GDP, so discussing changes in government spending solely in terms of GDP is misleading because it tends to conceal real increases in the level of funding and services provided.
If we look at spending in real per-capita terms (that is, spending adjusted both for inflation and population growth), we get a radically different picture: Rather than a slight, highly cyclical uptrend, we get a steep, straight, and virtually monotonically increasing graph, with spending more than doubling in the last thirty years. I'm tempted to do a send-up of this paper just by replacing the %GDP figures with real per-capita figures.
Of course, the fact that government spending is up doesn't necessarily mean that social spending is. However, as I'll show in the next installment, not only has total government spending increased significantly, but the increase has been skewed heavily towards social spending.