Economist Mark Thoma has a remarkable graph that shows the growth in federal spending under the last seven presidents (Nixon and Ford are combined). And it turns out that spending went up twice as much under Reagan than it has under Obama (this is an annualized rate, so 8 years vs 4 doesn’t matter).
In fact, you’ll notice that Obama and Clinton both have rates of growth in federal spending that are less than half the rate of any of the Republican presidents. So much for the fiscally conservative GOP.
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Yoritomo
March 23, 2012 at 9:47 am (UTC -4) Link to this comment
The title is wrong: Rather obviously, federal spending is higher under Obama than under Reagan. The increase in spending is lower under Obama. Know which derivative you’re talking about! :-)
Dexeron
March 23, 2012 at 9:49 am (UTC -4) Link to this comment
It’s a useful graph, but I think your headline is slightly misleading. It’s not that Federal spending is “Lower Under Obama Than Reagan”. It’s that Obama hasn’t GROWN spending as much as Reagan did, and depending on what the spending level was when you start measuring, the AMOUNT of spending could still be higher under Obama, even though he hasn’t “grown” it as much as Reagan did.
But don’t get me wrong: it’s still very useful, because even if Obama is spending more than, say, Bush II, raw totals are useless outside of context. Even if Obama increased spending by only a dollar, he’s spending “more” than Bush. Of course, he’s increased it by more than that, but the raw AMOUNT of spending is a fact that’s touted as a great scandal, even though it’s kind of meaningless in and of itself. That’s why this graph is good, to put those raw totals into some kind of perspective. It demonstrates how Obama, even while “spending more”, could actually be putting the brakes on spending increases.
But ultimately, a more important question to ask than “how much is he spending” is “what is the money being spent on, and do we feel that these are important things to invest in?” Unfortunately, that’s a much more complicated question than “IS GOVERNMENT BIG OR SMALL”, but I think it’s a more useful way of looking at the question of government spending, even if it’s a bit more nuanced.
zippythepinhead
March 23, 2012 at 9:58 am (UTC -4) Link to this comment
I’m always confused as what constitutes the budget these days. Does this chart cover/include discretionary spending, total spending (discretionary + non-discretionary), the stimulus, the TARP, the Afghan-Iraq wars?
Michael Heath
March 23, 2012 at 10:10 am (UTC -4) Link to this comment
Since we’re nitpicking, I would also argue this wasn’t merely “under” these respective presidents, but also the record of the corresponding Congresses.
For example, President Reagan did seek less discretionary spending, imprudently on non-defense items that promote economic growth so shame on him. So it’s important to note the above record wasn’t entirely under President Reagan’s control. But to minimize deficits, he compromised when a liberal/moderate-dominated Congress pushed back by agreeing to tax increases instead, as a fair to mediocre fiscal conservative would do.
As someone noted in Andrew Sullivan’s blog the other day, the current generation of Republicans are in no way fiscal conservatives since they strongly support policies which have and would continue to greatly increase deficits, both by limiting economic growth and by cutting taxes without cutting spending except in areas favored by non-conservatives.
Anri
March 23, 2012 at 10:20 am (UTC -4) Link to this comment
As far as I can tell, the expression ‘fiscally conservative’, as currently translated in the US, means nothing more or less than “I want to pay less in taxes”.
Am I missing anything important in making that assumption?
dukeyork
March 23, 2012 at 10:21 am (UTC -4) Link to this comment
I was looking into this, and I think it may be an artifact of the stimulus. Add far as I can tell, this is a ratio of the first year’s spending to the later year’s. I think this graph is more caused by the large spending in Obama’s first year than anything else, if I understand things.
slc1
March 23, 2012 at 10:23 am (UTC -4) Link to this comment
What should be pointed out every time the current crop of Rethuglicans complain about deficits, President Clinton bequeathed a budget surplus to his successor which the latter promptly pissed away in tax cuts for the rich and increased defense spending (yes I know that Heath doesn’t agree that the budget surpluses under the last two Clinton budgets were prudent but that’s another issue).
wscott
March 23, 2012 at 10:26 am (UTC -4) Link to this comment
I hate to dogpile on with the nitpicking, but Obama’s rate of growth is around 1.3, while Bush I’s is just over 2, so the above statement needs editing. It looks like Reagan and Bush II are both right around 2.6, so depending on what the actual numbers are, Obama may or may not be less than half of that.
None of which is meant to detract from the awesomeness of the information.
Deen
March 23, 2012 at 10:57 am (UTC -4) Link to this comment
@Michael Heath in #4: you’re right that it’s not just the president who is to blame, but Congress as well. But that argument still won’t support the right-wingers who want to blame Obama for all the spending increases. After all, it’s the Republicans who control Congress right now.
RustD
March 23, 2012 at 10:59 am (UTC -4) Link to this comment
This is a paraphrase of what the Reagan administration said back in the 80’s; “The rate of increase of inflation is decreasing.” All of my friends said, isn’t Reagan great, he has stopped the Carter inflation. I said no, they claim that the “rate of increase of inflation” (third derivative, I think) is decreasing, not inflation itself. The same with the title here, wrong derivative.
Anri
March 23, 2012 at 11:13 am (UTC -4) Link to this comment
Also: is increased government spending a bad thing?
Deen
March 23, 2012 at 12:10 pm (UTC -4) Link to this comment
@Anri: depends on what you get in return, doesn’t it? Something that never seems to factor into the discussion anymore, it seems.
juice
March 23, 2012 at 12:54 pm (UTC -4) Link to this comment
So to get a number that is lower for Obama than for Reagan you have to use the per capita annualized growth rate of spending. Um, ok.
Why even bring this kind of crap up? The president alone has little control over the spending rate over the course of his term since most of it comes in the form of “mandatory” entitlement payments.
The only way for a president to really have a significant effect on spending is to veto the crap out of everything a la Ron Paul. Is that what you want? Otherwise we have to rely on Congress and that hasn’t worked out for the past several decades.
juice
March 23, 2012 at 12:56 pm (UTC -4) Link to this comment
“rate of increase of inflation” (third derivative, I think)
Nope, just the first.
Deen
March 23, 2012 at 1:14 pm (UTC -4) Link to this comment
@juice: inflation is the first derivative of prices to time. The rate of increase of deflation is the second derivative. A decrease in the rate of increase of deflation is the third derivative.
Deen
March 23, 2012 at 1:18 pm (UTC -4) Link to this comment
No idea why I typed “deflation” twice, while I meant “inflation”…
RustD
March 23, 2012 at 2:47 pm (UTC -4) Link to this comment
Thanks Deen and Juice. I was thinking of it being the third derivative of cost. Cost, change in cost, change in change of cost. I was trying to relate it to my physics from 30+ years ago with position, acceleration and change in acceleration.
RustD
March 23, 2012 at 2:58 pm (UTC -4) Link to this comment
Arg, I should stop now. I didn’t write that correctly. I meant “A decrease in the rate of increase of inflation is the third derivative like Deen wrote.” I am going back to transfer my samples with the Ethyl Ether that is clouding my mind right now.
Michael Heath
March 23, 2012 at 7:38 pm (UTC -4) Link to this comment
slc1:
That’s the Democratic partisan version. However a recession started soon after President Bush was inaugurated, coupled to the crash of the Internet stock bubble followed by the crash of the telecom industry. In addition the labor market was becoming increasingly weak from a structural perspective which was revealed in each subsequent recession since the 1960s. That fundamentally and increasingly weaker labor market in the 2001 and what’s followed meant less jobs and therefore less people paying income taxes and more people collecting unemployment insurance, food stamps, Medicaid and SCHIP benefits. None of this was President Bush’s fault though one can make a very cogent argument much of it was it was the Republicans and moderates from both parties’ fault. In fact IIRC the first decade of this century was the weakest labor market in our history in terms of rate of job growth, where the president and the GOP both were major contributors to effecting.
If we assign credit to President Clinton and blame to President Bush as slc1 does here, we miss the very root causes which aggravated this past recession and make it even harder to advocate for effective correctives which address the root causes rather than mere symptoms or in the GOP’s case, prescriptives which do more harm than help. That being that successful capitalistic economies require both a dynamic regulatory framework and prudent government investments and outlays correlative to both the size and complexity of the economy.
slc1:
Michael Heath
March 23, 2012 at 7:44 pm (UTC -4) Link to this comment
Anri asks, I assume rhetorically:
This is an area which provides an illustrative example of how Democrats fail to win. I think increased government spending is a great thing when done in a way to increases: economic growth, median discretionary income, and makes for a stronger labor market.
Yet Democrats either argue for less spending, avoid the topic, or instead favor increased spending but tip-toe around the topic rather than blatantly and transparently being in favor of bigger government outlays.
scenario
March 23, 2012 at 7:45 pm (UTC -4) Link to this comment
What does it mean to be conservative? The two presidents who increased spending the least in the last 40 years are hated by conservatives. The presidents who increased spending the most are loved by conservatives.
The last president to balance the budget is hated by conservatives. The president who increased spending the second least in the last 40 years is hated.
The fiscal conservatives are the Democrats.
Fiscal conservatives are now considered liberals, what does conservative mean anymore?
slc1
March 24, 2012 at 9:27 am (UTC -4) Link to this comment
Re Michael Heath @ #19
I would remind Heath that unemployment during the Clinton administration fell below 4%, and was still around 4% when Bush took over. Bush’s policies of tax cuts for the rich and increased defense spending, which increases were aggravated by the response to 9/11, aggravated what could have amounted to a correction. These types of tax reductions and spending do little to stimulate the economy.
What the Clinton administration should be blamed for was agreeing to the repeal of Glass-Steagall which led directly to the speculative real estate bubble that collapsed at the end of the Bush Administration.
Interestingly enough, as Matt Yglesias has pointed out on his blog, employment in the private sector over the past couple of years has been, if not robust, at least occurring at a fair pace. The reason why unemployment has not fallen commensurately is due to layoffs of government employees at the state and local level. Of course, to conservatives like Heath’s hero Reagan, that’s great as people who work for the government are scum and drones.
Pierce R. Butler
March 24, 2012 at 11:15 am (UTC -4) Link to this comment
Deen @ # 9: After all, it’s the Republicans who control Congress right now.
Yes, but – that too is Obama’s fault.
Michael Heath
March 24, 2012 at 12:36 pm (UTC -4) Link to this comment
slc1 writes:
Are you claiming that fundamental weaknesses in the labor market were non-existent when U4 was low during the 1990s? That those weaknesses disappeared in the 1990s and re-emerged because of Republican policies in the early-2000s or are you claiming that there was no structural weaknesses in the labor market prior to and during the 1990s and Republican policies in the early-2000s was the origin of a weak labor market?
If so then I suggest addressing my prior premise:
Since your rebutting my prior point, are you denying that employment recoveries after recessions were increasingly weak from the 1960s onward? And if not, why does your response ignore this reality, as if merely stating low employment during the upside of the business cycle poo-poos it away? Do you even realize that my response is consistent with the fact we have business cycles with low unemployment during the upside phase where your response seems to avoid this fact given you rebut my point about recoveries from recessions with a point about good metrics during a completely different part of the business cycle? Do you realize how partisan it sounds to rebut a point about the downside of a business cycle and its following recovery with metrics from the upside portion simply because your side was in office? President Bush enjoyed unemployment rates down to the natural rate as well, which effectively falsifies your entire point. Without my even having to point out how you swing and miss by referring to metrics from a different part of the business cycle being addressed.
dingojack
March 24, 2012 at 12:52 pm (UTC -4) Link to this comment
Michael Heath – Are you sure about increasing weakness in unemployment recovery after successive recessions? To me the rate of recovery seems pretty near equal. (I could be wrong, based on the paucity of my sources).
Also what are the causes of this fundamental weakness in the labour market, in your opinion?
Curiously Dingo
dingojack
March 24, 2012 at 12:55 pm (UTC -4) Link to this comment
Oops the link doesn’t work. (Hope this works).
Dingo
Michael Heath
March 24, 2012 at 7:32 pm (UTC -4) Link to this comment
First, here’s a trend in unemployment: http://data.bls.gov/timeseries/LNS14000000. By slc1′s logic, the polices President Bush and congressional Republicans put in place in the early 2000s were an outstanding success since the unemployment rate in 2005 through 2007 was very close to the natural unemployment rate. I point this out to add evidence for the ludicrousness of slc1′s partisan rebuttal of my prior posts.
dingojack:
I was narrowly framing my response to slc1 to point out his logical error. I agree the rate of recovery has been stellar in terms of percentage gains in spite of conservative obstructionism; however, as the following linked graph shows, recovery in terms of time has been horrendous in terms of the volume of human suffering that underlies these numbers.
What I was communicating in general was that labor market in general is increasingly weaker and has been since the 1960s, that makes for bigger busts and therefore tougher recoveries. We see this in the metrics by noting ever-increasing degree of crashes which require increasing recovery time. This graph illustrates this point (Obama took office just prior to the bottom of the crash): http://goo.gl/MXGfb As I’ve noted, the trend I mentioned started in the 1960s, so ignore pre-1960s crashes to see the trend in terms of the length of the recovery and the depth of the crash. There are better graphs out there but I lost years worth of booksmarks from 2010 and prior a few months back. I think due to my starting to sync my bookmarks between browsers using Xmark last November to use different browsers on my laptop from the two I use on my smartphone.
Dingojack:
Lack of investment in areas where government investment is optimal. This isn’t merely a failure of the federal government, but also significant at the state and local level. At the local level we increasingly see site condominiums with private investment putting in the infrastructure due to the lack of tax revenues for public development of infrastructure – especially when it comes to residential development whereas there are lots of empty commercial developments which wasted taxpayer funds. A paucity of investments in infrastructure include fast and pervasive Internet bandwidth and a smart energy grid, traditional infrastructure as noted earlier, research, education, and job retraining.
An inability to adapt to a dynamic regulatory framework in continuous improvement mode, and a conservative disdain by conservatives in Congress and certain Administrations (W. Bush) for technocrats and policy wonks. Conservatives now prioritize politics at the expense of the national interest and demonstrate an increasing fealty to a radical set of talking points with no foundation in reality or success but instead rooted in historical failures.
These performance failures are greatly aggravated by there being less demand for the U.S. to take on a large share of economic development outside the U.S. coupled to increasing competition from developed and developing economies; amplified by our failure to adapt to competencies which would distinguish us from these other countries. Some of those countries now enjoy competitive advantages over the U.S. in certain areas, and not just cheaper labor, but also certain engineering competencies. For example, by the end of the 1990s Taiwan had far more capacity to build complex bare printed circuit boards than the U.S. I perceived this due to a disproportionate of their best and brightest entered that industry while our’s was instead focused more on software development, the law, and high finance. [That industry has its roots in some relatively dirty, toxic processes, though its cleaned itself immensely over the past couple of decades, and better managed the dirtier aspects which remain.]
dingojack
March 25, 2012 at 1:55 am (UTC -4) Link to this comment
Michael Heath – Thanks. I value your opinion on economic matters. You seem to not only understand it, but also are able to communicate how it works to those (like myself) who don’t.
Just to be clear. I am certainly not making any claim that one politician or another has the magic ability to control the economy absolutely. They can pull all the levers and press all the buttons – and still a foreign war, jitters on another market or an adverse trade deal can spoil everything.
The sooner we disabuse ourselves of this notion that politicians are magic the better for all of us. (In my opinion).
Dingo
—–
Www, I really use some weird turns-of-phrase. Too many Victorian novels perhaps? ;)
dingojack
March 25, 2012 at 3:41 am (UTC -4) Link to this comment
My own ad hoc analysis:
Length of recession per President 1948-2008:
Truman: 21.5/48 months (44.79%) of job losses
Eisenhower: 54.5/96 months (56.77%)
Kennedy/Johnson: 9/96 months (9.9%)*
Nixon/Ford: 32/96 months (33.33%)
Carter: 4/48 months (8.33%)
Reagan: 33/96 (34.28%)*
Bush I: 31/48 (64.58%)
Clinton: (0/96)
Bush II: 67/96 (69.79%)
[Obama: probably 100%]*
(excluding Obama)**
Republican: 217.5/432 (50.35%)
average: 252.5/720 (35.07%)
Democratic: 35/288 (12.15%)
[source: graph linked to by Michael Heath above]
Dingo
—–
* To be fair these inherited recesssions from their predecessors
** Naturally this in no way takes in account the total jobs losses, the rate of change in job losses or the economic factors beyond the control of the Presidents.
Correlation is NOT causality. One person didn’t create the recessions. Other factors were certainly in play.
Michael Heath
March 25, 2012 at 5:04 pm (UTC -4) Link to this comment
dingojack:
President George W. Bush and the 2001-2002 Congress also inherited an economy which led to a recession.
dingojack
March 26, 2012 at 1:03 pm (UTC -4) Link to this comment
Michael – Yes, but that doesn’t effect the numbers as stated. I did mention ‘other factors’ somewhere didn’t I?
;) Dingo