When describing spending growth in federal programs, I often need to use words like “soaring” and “explosive.” But growth in federal health spending is almost beyond superlatives to describe it, and it will increase even faster as a result of President Obama’s new health legislation.
As an opponent of government growth, I’m interested in what we can learn from history to help us reverse the trend going forward. We need to understand the mechanisms of government growth if we are to combat the disease.
The head of the federal Office of Personnel Management, John Berry, has become unhinged by a few recent critiques of federal worker pay. Berry is an Obama appointee who apparently views his role as being a one-sided lobbyist for worker interests, rather than a public servant balancing the interests of taxpayers and federal agencies.
1. Additional federal spending transfers resources from the more productive private sector to the less productive public sector of the economy. The bulk of federal spending goes toward subsidies and benefit payments, which generally do not enhance economic productivity. With lower productivity, average American incomes will fall.
President Obama is apparently planning to freeze a portion of federal spending for three years. The portion to be frozen is discretionary spending less spending on defense, homeland security, and veteran’s affairs. That portion of spending–about 13 percent of the overall budget–would be held to $447 billion between FY2010 and FY2012.
January 22, 2010 is a day that should live in infamy, at least among believers in limited government. On that day, the federal government added its 2,000th subsidy program for individuals, businesses, or state and local governments.
That’s the title of a USA Today analysis, which reveals an outrageous increase in salaries at the top levels of the federal workforce. I’ve been complaining about excessive federal pay for some time based on one set of data, and now Dennis Cauchon provides strong support for my thesis using a different set of data.
The Taxpayers’ Alliance has published a new study examining a sample of 240 government capital projects in Britain, including weapons systems, highway projects, computer upgrades, health care spending, and other items. The results mirror the serious cost overrun problems we have in the U.S. federal government.
The Washington Post is full of so many stories about government failure these days, it’s hard to keep up.
Today, on page A19 we learn about a Small Business Administration subsidy program that has a 60-percent default rate. On the same page, we learn that the U.S. Postal Service will lose $7 billion this year.
With the government running huge deficits and average family incomes stagnating in the recession, it is unseemly that federal worker pay continues to soar. I’ve called for an immediate freeze to federal worker pay, at least until the economy recovers and private worker pay starts catching up.