OPINION

Understanding the US by Numbers: A Small Government

Written by Spincycle
Published December 12, 2006
page 1 | 2 | 3

The second caveat is the question of whether exclusive focus on federal budget rather than on total government spending that includes spending at state and local level. In particular a focus on federal budget will understate the government spending for strong federal governments like US. While that is true, it appears that federal spending and state and local spending are not inversely proportional in countries with strong federal structures but are strongly correlated, and that state spending even in strong federal countries is comparatively much smaller than the federal spending. Hence, while relying solely on federal budgetary expenditure does understate the impact, it doesn't do it by as big a margin as one would expect. Take for example, US, whose total budget at state level is around $600 billion, adding which pushes total government spending to $3 trillion or still about .25 of the GDP.

The third caveat one must look at it is not only the size of budgetary spending but where it is spent. For example, the US military budget accounts for a fifth of its net budget by conservative estimates. In sheer numbers, the US military budget exceeds the total military spending of the rest of the world but in terms of its size relative to US GDP, it is a measly 4%.

 

Developed countries pool:

Country

GDP (in trillions, 2005 estimate, unless mentioned otherwise)

Budgetary Expenditure (in trillions, 2005 est. unless mentioned otherwise)

Proportion of budget/GDP

Germany

$2.73

$1.362

.498

France

$2.055

$1.144

.556

UK

$.951

$2.228

.426

Italy

$.8615

$1.71

.503

Norway

$246.9 billion

$131.3 billion

.531

Japan

$4.664

$1.775

.380

Switzerland

$367 billion

$143.6 billion

.391

Australia

$612.8 billion

$240.2 billion

.391

 

Developed North American economies

USA

$12.49 trillion

$2.466 trillion

.197

Canada

$1.035

$152.6  billion(est. 2004)

.147


Developing country pool:

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Spincycle is interested in questions around media, governance, and political economy. He strongly values reading good fiction for he feels that it imparts the important value of empathy.
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Understanding the US by Numbers: A Small Government
Published: December 12, 2006
Type: Opinion
Section: Politics
Filed Under: Politics: Government, Politics: International, Politics: U.S.
Writer: Spincycle
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Comments

#1 — December 12, 2006 @ 17:14PM — shockeymoe

As a Canadian I am pleasantly surprised to note that our ratio is the lowest of all cited here. I would be curious to hear what might be said by our right leaning critics of "big government" in Canada. It seems to me that the criticism is unfounded judging by the numbers.

#2 — December 14, 2006 @ 18:38PM — Baronius

I don't see Europe as something to aspire to.

Great empires become bloated not by time, but by regulation. The Roman Empire became top-heavy and lost its innovation. It was a couple of centuries before its neighbors noticed, but when they did, Rome fell. Chinese dynasties built themselves up and eventually crumbled internally. When Spain and Portugal got lazy, England made its move.

Today, we've got the Western World in contention with Islam. Why? Because Europe is showing weakness. They're unproductive and rely on their governments. No suprise that Asia smells blood in the water. Islam is right; they can mop the floor with Europe. But they made the mistake of taking on both Europe and the US. There's still a lot of prosperity and growth potential in the US. America will defy the rest of the world - I think - and Islam won't get much more than Paris and Brussels.

If I read this article correctly, the implication is that we shouldn't be afraid to embrace a European-style bureaucracy. Development is, after all, the process of becoming less like Indonesia and more like Europe. I believe that such thinking would be catastrophic.

#3 — December 14, 2006 @ 21:07PM — Clavos

So we are spending less as measured as a percentage of GDP AND we (as individuals) have more control of the budget through our vote than citizens of other nations?

Come April 15, I will try to remember that...

Baronius,

I agree with your point about Europe. I DO think we can learn from European mistakes, but we shouldn't emulate them. I don't see much over there to emulate these days.

#4 — December 14, 2006 @ 23:11PM — Dave Nalle [URL]

This information will make tax day a bit less painful. But given how painful it is and how much more our government spends than it needs to, this article makes me truly horrified at the conditions of oppression which most of the rest of the world lives under.

Dave

#5 — December 18, 2006 @ 15:47PM — Mooja

Very interesting article. I'd be interested in seeing this broken down further to see if the disparity can be shown tied to a particular area, e.g. Defence, welfare, infrastructure, etc. or if it's equal across the board.

#6 — March 21, 2007 @ 14:06PM — Courtney

Europe is a terrorist country!!!

#7 — March 21, 2007 @ 14:10PM — Danieka

i agree with Courtney!!

#8 — October 25, 2007 @ 13:05PM — Sergei

This is a good example of falsified propaganda. A part of budget is compared to a whole budget of other counties.

For the USA, a small part of budget (federal part, practically not used for US life but for other purposes) was used. A multiplier of ~ 2.5 will appear if state budgets (they pay for the US needs) will be added. And the whole budget, with counties and citied will go to 55 to 70% of GDP.

Why do not take a federal budget of some another federal country, like "high budget" Sweden and find out, how much higher in reality the USA federal budget?

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