How Big is the Government?

Jun 27, 2022 | Macro Insights

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Summary: Total government expenditures as a % of GDP was 27% in 1960 and, by the 2020 lockdown, this ratio steadily grew to a high of 44%. That means total government expenditures during 2020 represented nearly half of total GDP. This is problematic as the government doesn’t actually create anything, rather it taxes & prints money then distributes the funds as it sees fit. If the federal government shut-down, our economy would almost shrink by half. In essence, we see the government “crowding out” private enterprise by commandeering too many of our country’s resources. It is time for US citizens to consider whether the government’s role has expanded beyond what is optimal for a private market economy. 

Gov spending over GDP

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