A cab ride in Washington, DC on a weekday afternoon in June gives you a feeling of the national mood. It’s oppressively hot and humid and the traffic is horrible. By the time you reach your destination, you feel strangled and oppressed and just want relief.
Amidst the current lethargic economic recovery, with unemployment still just under 10%, the one growth stock remains government. Washington, DC is a boom town today as the answer our current administration proposes for every single problem and challenge facing us is more government.
Government spending is now 25% of our GDP. This is five percentage points higher than the average of the last fifty years.
A new Wall Street Journal/NBC poll reflects the nation’s nasty mood. Sixty two percent now say the country is “on the wrong track,” compared to 43% saying this a year and a half ago.
A fascinating online dynamic map display, called “The Decline: The Geography of a Recession” (you can easily find by googling), shows color coded unemployment levels county by county throughout the country. Areas where unemployment is 4-6% are orange and red. Areas of 7-10% unemployment are purple.
The map display starts in January 2007 when national unemployment was 4.6%. It shows a sea of orange and red across the nation. You then click, and it changes by month, getting increasingly purple, until ending in March 2010 with national unemployment at 9.7%.
Looking at this picture of the whole nation swathed with the purple color of high unemployment, you can’t miss the tiny island of orange and red in the midst of all this. It’s, of course, the region of our nation’s capital.
Another bold graphic of our dismal state of affairs is an outstanding series of charts on the nation’s fiscal situation put together by Brian Riedl of the Heritage Foundation. You just can’t get a clearer picture of the cliff we are about to drive over.
Total government spending (federal, state, and local) per American household is now $47,000. This is almost triple what government spending per household was in 1965.
But consider further that this $47,000 government spending per household is almost equal to the nation’s median household income – about $51,000.
In 1970 government spending per household was about half of median household income.