If you measure spending at all levels of government — federal, state and local — relative to the nation’s GDP, you find that there generally has been no sharp rise in expenditures in recent decades, despite all the political rhetoric to the contrary.
Kevin Drum EXAMINES the figures for the past 80 years and concludes that “government spending increased steadily until the mid-70s, but since then it’s flattened out almost completely.”
[G]overnment expenditures in general haven’t been on an inexorable upward path over the past three decades, and there’s no special reason to think they’ll rise inexorably in the future. Generally speaking, domestic spending, defense spending, and Social Security are on extremely sustainable paths.
What’s left is healthcare spending. That’s it.
So this is basically just another excuse to repeat something that I and others have said over and over: We don’t have a spending problem in America. We have a healthcare problem. The other three categories of government spending taken together will probably rise by a point or two over the next few decades, but that’s not a big deal. We need to pay normal, prudential attention to them, but nothing more.
Bottom line: no one serious should spend an awful lot of time talking about “the deficit” or about “government spending.” We should be talking about healthcare. Everything else is just a red herring.