Saturday, February 6, 2010

Climb Every Mountain

"The first rule of this house is discipline."
--Captain Georg von Trapp (Sound of Music)

Nice picture of government spending as a % of GDP since our founding. Includes labels of various meaningful events.

Note the 'spike' effect of all major wars. Observe, that following our first major war, the War of 1812, spending recede after the war to prior levels, which was 1-2% of GDP.

Following the Civil War, we find the same 'recede then level' phenomenon, although we leveled off at a slightly higher level.

This all changed with the turn of the last century, with the commencement of the Progressive Era under President Theodore Roosevelt's watch. In the subsequent 100+ yr period, government spending has lifted from about 3% of GDP to about 45% today. Big differences in the pattern include the non-war spikes in response to economic crises, plus the chronic trend as annual spending increases became a way of life.

This picture demonstrates that it hasn't always been the way it is now.

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