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Friday, October 13, 2006

Peter Beinart Says Spending Hasn't Exploded; David Hogberg Differs

David Hogberg sent this over:
I noticed this in an article in The New Republic by Peter Beinart about discretionary spending under President Bush:
To listen to Bush's critics, you would think that discretionary, nonsecurity-related spending has exploded on his watch. But it hasn't. As the Center on Budget and Policy Priorities has shown, when you take account of inflation and population growth, it grew a mere 2 percent between 2001 and 2006. And, as a percentage of GDP, it actually fell. What has exploded -- rising 32 percent after inflation and population growth -- is spending on defense, homeland security, and international affairs. And the people most responsible for those increases are conservatives themselves, who demanded an expansive war on terrorism.
You mean all of those conservatives complaining about domestic discretionary spending are wrong? That didn't seem to pass the smell test, so I tracked down the Center for Budget and Policy Priority (CBPP) study that I think Beinart was referring to, and it turned out that CBPP is using the wrong numbers. If you scroll down toward the bottom of that study to the "Appendix Table," you'll notice that the CBPP uses "budget authority" numbers. This is key, because budget authority is what Congress authorizes, by law, to spend each year (in fact, Congress usually spends less than it authorizes). What Congress actually spends each year is called "budget outlay." Thus, CBPP didn't measure what Congress actually spent, but what it was allowed to spend.

Using some numbers from the Heritage Foundation and the Congressional Budget Office (pdf), I was able to calculate the increase in what Congress actually spent from 2001-2005 (final numbers on outlays for 2006 are not yet available). When controlling for both inflation and population, the increase was about 13%, not 2%. Nor did it decline as a percentage of GDP. Indeed, it rose from 3.1% in 2001 to 3.6% in 2005.

I emailed Beinart to this effect, asking whether we should use actual spending instead of authorized spending when talking about spending increases. I'll let you know if and when I get a response.

Posted by Amy Ridenour at 6:40 PM

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