Paul Jacob

“Today, government at all levels consumes 37 percent of the total economy, or GDP,” Republican presidential nominee Mitt Romney said earlier this month. “If Obamacare is allowed to stand, government will reach half of the American economy.”

Half. In a land of supposedly limited government, can what the father of our country called “a dangerous servant and a fearful master” really constitute that much of the entire economy?

Say it isn’t so.

Glenn Kessler’s “Fact Checker” column at the Washington Post did just that. He slapped Romney’s statement with four “Pinocchios,” the worst possible condemnation reserved for those telling the biggest “whoppers.”

Yet, Kessler acknowledged Romney’s first point. In 2011, local, state and federal “government expenditures amounted to 37.34 percent of the gross domestic product.” That percentage is expected to climb to just over 39 percent by 2020.

Sure, the columnist quibbled with that percentage, arguing that the current figure would be lower if the economy were not so depressed. (Or recessed?) But that doesn’t contradict the veracity of Mr. Romney remarks.

Kessler also insinuates that it was somehow unfair to lump local, state and federal governments together. But, what else would “government at all levels” mean?

Then, Kessler notes that much of government spending constitutes transfer payments such as Social Security and offers the analysis of Henry J. Aaron of the Brookings Institution, who contends, “Collecting taxes from one private party and transferring the revenue to another private party is not government ‘consuming.’”

Well, it is if you’re the party handing your hard-earned dough over to government.

Budget expert Richard Kogan, at the liberal Center on Budget and Policy Priorities, suggests that government interest payments shouldn’t count as “government consumption,” either. It is most clearly the cost of past consumption, however.

Granted, Kessler is correct that “Romney goes way too far.” Romney counts private medical expenditures, which he claims will supposedly account for 10 percent of the projected 2020 economy. Romney’s campaign spokesperson argues Obamacare in part mandates that spending and thus the 10 percent is part of government’s “reach.”


Paul Jacob

Paul Jacob is President of Citizens in Charge Foundation and Citizens in Charge. His daily Common Sense commentary appears on the Web and via e-mail.