Does the Government Provide Public Goods?
March 1st 2010 15:05
While the main issues of this blog are international trade and immigration, the topic of how government should be formed is fair game. In this post, we are going to wander into the area of government. When people who are in favor of lower taxes and less government spending express these views, opponents commonly respond along the lines of "I guess you don't want roads and bridges, or schools, or libraries, etc." Do people truly believe this to be a logical defense of high government spending and taxes? Do people truly think that the majority of government spending goes toward Public Goods? (To be fair, people who claim that those who want any sort of taxes or government spending are merely pushing a Marxist agenda are also off the mark.) Let us take a look at the government spending breakdown in the U.S., as of 2008:
NOT PUBLIC GOODS
21% goes to Social Security.
20% goes to Health Programs.
11% to other Safety Net Programs.
8% pays interest on the debt.
6% goes for benefits to Federal Retirees and Veterans.
1% Non-Security International
PUBLIC GOODS (arguably)
21% to Defense and Security (of this, how much truly goes toward "Defense and Security?" and not "Offense and Annoyances")
3% to Scientific and Medical Research
3% to Transportation Infrasctructure
2% to Education
If we give the most generous calculation of Public Goods (and we can include the Federal Retiree and Veterans benefits into the legitimate spending and we can toss in the 5% to other, although I doubt much of that goes toward Public Goods), this accounts for 21% 6% 5% 3% 3% 2%= 40%. In other words, we could cut out 60% of the budget and still be left with all of those valuable schools, libraries, and roads! If we round up to $3 trillion (it was actually 2.9) for the 2008 budget, that means the Federal Budget could have been as "small" as $1.2 trillion and still done all of those necessary functions. As a fraction of our economy, this would have dropped the Federal Spending/GDP from 21% in 2008 to 8.5%!!! That would bring the United States back to pre-WWII levels of government. That would certainly take care of any impending fiscal crisis.
Follow me on Twitter: @AGoldenDoor
NOT PUBLIC GOODS
21% goes to Social Security.
20% goes to Health Programs.
11% to other Safety Net Programs.
8% pays interest on the debt.
6% goes for benefits to Federal Retirees and Veterans.
1% Non-Security International
PUBLIC GOODS (arguably)
21% to Defense and Security (of this, how much truly goes toward "Defense and Security?" and not "Offense and Annoyances")
3% to Scientific and Medical Research
3% to Transportation Infrasctructure
If we give the most generous calculation of Public Goods (and we can include the Federal Retiree and Veterans benefits into the legitimate spending and we can toss in the 5% to other, although I doubt much of that goes toward Public Goods), this accounts for 21% 6% 5% 3% 3% 2%= 40%. In other words, we could cut out 60% of the budget and still be left with all of those valuable schools, libraries, and roads! If we round up to $3 trillion (it was actually 2.9) for the 2008 budget, that means the Federal Budget could have been as "small" as $1.2 trillion and still done all of those necessary functions. As a fraction of our economy, this would have dropped the Federal Spending/GDP from 21% in 2008 to 8.5%!!! That would bring the United States back to pre-WWII levels of government. That would certainly take care of any impending fiscal crisis.
Follow me on Twitter: @AGoldenDoor
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