Your Lying Eyes

Dedicated to uncovering the truth that stands naked before your lying eyes.

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09 March 2011

Even the New Deal Was a Better Deal

A few days ago I posted on our Bogus Recovery (which thanks to a Derb link has had a whole lot of hits). The point is that our deficit spending, which is supposed to have the counter-cyclical effect of putting money in people's pockets and snapping us back into shape, is far exceeding any growth in the economy, and so we're just digging ourselves a bigger hole.

But what about the Great Depression? Surely the massive New Deal spending would have swamped any growth during the recovery?

There are no quarterly data on GDP and deficits from back then (at least none I could find), but there are annual numbers (here - Deficits on Table 1.1, GDP on Table 1.2). The last year of negative growth was 1933, so we'll count the recovery starting from then. In 1934, the deficit and GDP growth were identical at $3.6b - but from there it wasn't even close - GDP growth far outstripped the accumulated deficit.
So even compared to the New Deal, our current profligacy is overwhelming.

How does this compare with current projections? Let's look at an optimistic view - the White House's own projections:

Not looking too good.

Data reviewable here.


Anonymous safe meds said...

Why you don't post the updated charts, it would be interesting!

October 26, 2011 10:38 AM  

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