Pretty Pictures of the Federal Budget (FY 2011 Version)

The Federal Budget for Fiscal Year 2011 came out today. We continue the tradition (because we've done it before, in 2005, 2007, 2008, and 2009) of producing some simple graphs from the tables provided.

Here's a graph of Federal receipts and outlays since 1977, expressed as percent of GDP; post-2009 numbers are estimates:

[In and Out]

Here's what that works out to in terms of deficit spending:

[Usually More Out]

Click on the graphs for their fullsize versions. Data is here (snipped from Table 1.2 on this page) and my Gnuplot script is here. If you'd like to see the data extended back to 1930: here's the receipt/outlays graph and here's the deficit graph.

Standard disclaimer: if you're thinking this is simple-minded, you're right. In my defense, the percent-of-GDP seems appropriate for historical comparison; it seems to be (arguably) a good measure of what we can "afford"; and, if you believe deficits "damage the economy", then it's a pretty good proxy for the level of damage.

Observations:

  • Good news: FY2010 outlays are predicted to be "only" 25.4% of GDP; last year's estimate for FY2010 outlays was 27.7% of GDP.

  • That's only good news if you're an idiot. 25.4% of GDP is still the highest outlay level since 1945. (As recently as FY2007 it was only 20.7% of GDP.)

  • FY2011 spending is projected to only shrink slightly below FY2010: 25.1%.

  • FY2009 and (predicted) FY2010 receipts are 14.8% of GDP, the lowest level since 1950;

  • The deficit is estimated to peak at 10.6% of GDP in FY2010, also the highest it's been since 1945. (As recently as FY2007 it was 1.2% of GDP.)

Some other random comments and URLs:

  • Daniel J. Mitchell at Cato:
    The bad news is that federal government outlays only consumed 18.2 percent of economic output when Bush took office. In other words, […] the size and scope of government has increased dramatically since 2001. The worse news is that the long-run spending forecasts show a cataclysmic expansion in the burden of government. The "optimistic" estimate is that the federal government will consume more than 30 percent of GDP by 2050 and 40 percent of GDP by 2080.
    And the even worse news is: anyone who has been paying attention will not find this surprising at all.

  • Also at Cato, Tad DeHaven piles on:
    Just like Bush, the president proposes minuscule savings through a small number of program terminations and reductions. But overall spending continues to rise, and in a $3.8 trillion budget the president's disingenuous attempt to "cut" anything amounts to little more than a rounding error. The president also proposes to freeze non-security discretionary spending for three years, which he falsely claims will "help put our country on fiscally sustainable path." In reality, last year's stimulus and appropriations spending binge will mean actual outlays for this tiny portion of the overall budget will still be higher than what Obama inherited.
    Quibble: Cato folks don't like Dubya's fiscal policy much, but the deficit in FY2007 really was 1.2% of GDP. I'd be pretty happy to trade that number for today's.

See you next year. I hope.

Last Modified 2012-10-04 3:13 PM EST