Too much government spending?

The Bush administration and Republican Congress want to strangle government spending. One purpose of the tax cuts (in addition to giving themselves and their wealthy supporters another break) is to starve the government and force further spending reductions. Grover Norquist, a powerful, right-wing Washington insider, once said, “I don’t want to abolish government. I simply want to reduce it to the size where I can drag it into the bathroom and drown it in the bathtub.”

Of course, they don’t want to cut spending for military adventures or prisons or lucrative contracts for their favored corporate crooks. They want to cut any program that helps ordinary people deal with basic or emergency needs for health care, childcare, education and economic security.

The success of the Republican plan can be seen in a report by the Center for Budget and Policy Priorities. With the new tax cuts, federal receipts as a share of the national economy will fall to their lowest level since 1959. It is likely they will fall even further next year. The resulting deficits will surely be used as an excuse for further spending cuts, with Social Security and Medicare the long-range targets.

Their biggest tool is the myth that the government spends too much. It is common for politicians and right-wing ideologues to use the phrase, “bloated government bureaucracy” any chance they get. Newspapers print commentaries with headlines like, “Washington Still in the Grip of Big Spenders” and “Big Spenders Dominate Capitol Hill.” The message is clear: federal spending is out of control.

Is government spending really a big and growing burden?

First, let’s look at that “bloated federal bureaucracy.” In 1960, the national government employed 3.7 percent of all workers, but by 2000, only 2 percent of all workers were employed by the feds. In fact, the 2.7 million federal workers in 2000 was fewer than the 2.9 million in 1970, despite the growth in the U.S. population and labor force over thirty years. Of every hundred dollars that flows through the national economy, only $1.35 goes to pay federal workers – less than half what it was in 1970.

What about total federal spending? The best measure is in comparison with the gross domestic product (GDP) – the total value of all economic activity. In 1983, federal spending reached a high of 23.5 percent of GDP. Starting in 1992, it started a steady decline, and by 2000, federal spending was down to 18.4 percent of GDP – lower than at any time since the late 1960s.

To measure the size of government, it makes sense to exclude federal trust funds (Social Security, Medicare, etc.) from the federal budget. These expenditures have been rising because of an older population and escalating health care costs. Their increasing expense does not represent any new needs being met, but rather the growing costs of providing existing services. By this measure, the federal budget has dropped under 10 percent of GDP, far lower than the 14.5 percent level of 1970, or even the 14 percent of 1960.

When right-wing politicians complain that the government is “too big,” they are lying. By any reasonable measure, the federal role in U.S. economic life has been shrinking. And that is unfortunate, because the need for government involvement is growing.

In 1960, an eighth grade education was enough for a manufacturing job that provided an adequate standard of living. Today, a college education is usually required for even a chance at a comparable job. Education, childcare, health care, environmental protection – these are all areas that demand much greater government involvement today compared with forty years ago. The physical infrastructure of our country – the water supplies and treatment facilities, mass transit and bridges, housing and recreation facilities – needs urgent attention.

By failing to meet these growing needs, the federal government has failed in its responsibility. State and local governments do not have the resources, and many have been driven to the brink of bankruptcy in their efforts to pick up the slack.

A simple program: (1) Reallocate federal spending from military and corporate subsidies to meet human needs; (2) Increase federal spending to reflect the growing social needs of our society; (3) Restore uniform, loophole-free taxes on high-income individuals and corporations to meet these needs.

The author can be reached at pww@pww.org