Starving the Beast: De-Funding the American Government 1970-Present

[The Minsky Moment]

The irony is that the GOP really does have a plan to boost the economy by defending against alien attack:
http://www.rawstory.com/rs/2013/06/25/mccain-well-make-border-with-mexico-look-like-the-berlin-wall/

[Ideologue]

Look, I'll concede sometimes even the GOP has good ideas.

[The Minsky Moment]

It is interesting to look at federal spending since WW2 and peel out all the entitlements and defense spending.  Focus just on education, transportation, and other domestic discretionary spending.  What you see in fact is that such spending is at an all time post-war low in terms of %GDP.  There is a little blip in 2009 from the stimulus which took it back to just slightly above historical "normal" levels of spending on those categories.  Then it crashed back down to levels which aside from the Gingrich-Clinton years, have not been seen since Hoover.

McKinsey recently released a cross-country analysis of infrastructure spending gaps and the findings showed that the US has one of the larger gaps (I think the largest in total dollar amount).  So really on some key items were are not spending enough.

Spending is driven by the following facts:
1) the US spends more than any other peer nation on defense and security, by a very wide margin.
2)  the US government spends more on health care than typical peer nations despite having only a partial public system.  The US is grossly inefficient in terms of health care outcomes/$ spent.
3)  Public pension provision (social security) - no political party wants to touch this. 

[Ideologue]

So really on some key items were are not spending enough.

Concur.  However:

1) the US spends more than any other peer nation on defense and security, by a very wide margin.

What is a "peer nation" in this context?  The takeaway here is not simply that we are inefficient at defense (though we are, and I have outlined a strategy to reduce defense spending by 90% or more and still maintain total military dominance ), but that America has far greater military obligations than, say, Austria.

[The Minsky Moment]

What is a "peer nation" in this context?  The takeaway here is not simply that we are inefficient at defense (though we are, and I have outlined a strategy to reduce defense spending by 90% or more and still maintain total military dominance ), but that America has far greater military obligations than, say, Austria.

Europe and OECD countries in Asia and Latin America.
I am not claiming that such spending is unecessary or inefficient (it may be) only that it is higher.

[Razgovory]

Krugman is wrong about all of this of course.  He is committing the elementary error of seeing a conspiracy in what can be ascribed to simple incompetence and disorganization.

I'm going to disagree with both.  I don't think there is a full-blown conspiracy out there.  However, I also don't think that this clusterfuck is entirely without intelligent design.  I think the strategy with tax cuts was much like the strategy with Obamacare:  get something enacted that would be hard to repeal, turn it into a fact on the ground, and make further favorable changes inevitable sometime down the road.  It's subtly different from Krugman's theory of starving the beast, but only subtly.

I'm not seeing a conspiracy,  After all it's not much of a conspiracy when you announce your plans.  It's simply a strategy to achieve a certain policy.

[Admiral Yi]

How did McKinsey calculate this infrastructure gap Joan?

[Tonitrus]

Prepare for alien attack? Put a taco under a box trap. Done.

katmai is not an alien. 

[Ed Anger]

Prepare for alien attack? Put a taco under a box trap. Done.

katmai is not an alien. 

We don't know that.

[The Minsky Moment]

How did McKinsey calculate this infrastructure gap Joan?

http://www.mckinsey.com/~/media/McKinsey/dotcom/Insights%20and%20pubs/MGI/Research/Urbanization/Infrastructure%20productivity/MGI_Infrastructure_Full_report_Jan2013.ashx

See exec summary, page 3, box 1.

[Weijun]

When you carve out entitlement spending, federal spending/GDP is lower now than it was in 1970, 1980, or 1990.  It reached its lowest point during the Clinton years.

Why would you carve out entitlement spending?

[Valmy]

When you carve out entitlement spending, federal spending/GDP is lower now than it was in 1970, 1980, or 1990.  It reached its lowest point during the Clinton years.

Why would you carve out entitlement spending?

Maybe because it tends to fluctuate due to things not connected to spending policies?  Like we have more old people now, so more spending on entitlements to the elderly, but not because we actually passed a bill increasing elderly benefits.  Just a guess.

[The Minsky Moment]

Yes because it is mandatory. 

[Scipio]

So really on some key items were are not spending enough.

Concur.  However:

1) the US spends more than any other peer nation on defense and security, by a very wide margin.

What is a "peer nation" in this context?  The takeaway here is not simply that we are inefficient at defense (though we are, and I have outlined a strategy to reduce defense spending by 90% or more and still maintain total military dominance ), but that America has far greater military obligations than, say, Austria.

The Arthur Bomber Harris plan, right?

[grumbler]

The Arthur Bomber Harris plan, right?

It was something wackadoodle like that.  Ide is a better lawyer than a military thinker.