GDP

Economy – Trump’s vs. Obama’s Upward Trajectories

Published by Papa Giorgio

The new economic lie is with the sad growth of GDP during Obama’s tenure AS COMPARED to Trump’s “upward trajectory.” The IBD article Prager is reading from is entitled “Economic Boom: Media Rewrite History To Credit Obama Instead Of Trump“.

IBD:

…In fact, The New York Times itself described Obama’s economy this way in August 2016: “For three quarters in a row, the growth rate of the economy has hovered around a mere 1%. In the last quarter of 2015 and the first quarter of 2016, the economy expanded at feeble annual rates of 0.9% and 0.8%, respectively. The initial reading for the second quarter of this year, released on Friday, was a disappointing 1.2%.”

GDP growth decelerated in each of the last three quarters of 2016.

And on January 27, 2017, after the government reported that GDP growth for all 2016 was a mere 1.6% — the weakest in five years — the Times announced that “President Trump’s target for economic growth just got a little more distant.”

That same month, the nonpartisan Congressional Budget Office forecast growth this year would be just 1.9%.

There were other signs of stagnation as well. Stocks had flatlined in 2016, with major indexes down slightly. Real median household income dropped that year, according to Sentier Research.

Growth had been so worrisomely slow throughout Obama’s two terms in office that journalists started warning about “secular stagnation.” They said the country was in a period of long, sustained, slow growth resulting from slow population and productivity growth.

In August 2016, the Times declared that “the underlying reality of low growth will haunt whoever wins the White House.”

Predictions of Slow Growth

The next month, CBS News reported that “with U.S. economic growth stuck in low gear for several years, it’s leading many economists to worry that the country has entered a prolonged period where any expansion will be weaker than it has been in the past.”

In short, there was no upward trajectory to the economy on anyone’s radar when Trump took office…..

Dennis Prager poses a 64,000-dollar question to Andy Puzder, which brings clarity to the differences in the two economies when compared so far. (Puzder is an American attorney, author, and businessman… former chief executive officer of CKE Restaurants, the parent company of Hardee’s and Carl’s Jr…. previously a commercial trial lawyer in private practice from 1978 to 1995 who handled many high-profile cases and was active in the pro-life movement…. Puzder is a frequent commentator on economic and political issues.)

Military Spending vs. Education and Health-Care Spending

Published by Papa Giorgio

(I am changing some of my “Pages” to “Posts,” so some of this info is older to my site)

Total GDP Expenditures on…

★ MILITARY (2014): 3.5%

★ EDUCATION (2014): 4.9%

★ HEALTH (2014): 17.1%

NATIONAL REVIEW has a great article on this:

A few more thoughts on the view from 1957. Relative to the size of the U.S. economy (which is to say, as a share of GDP) we have cut military spending to barely a third of what it was in 1957, from 9.8 percent of GDP then to 3.3 percent of GDP now. Even though we were spending three times as much on national defense in 1957—and even though we had lower taxes (17.2 percent of GDP then vs. 17.7 percent of GDP today) we ran a budget surplus. It’s usually described as a “modest” surplus, but at 3.4 percent of GDP, the budget surplus of 1957 was proportionally larger than military spending is in 2015.

So, where’d the money go?

Feel free to consult the historical data yourself, but the short answer is: welfare spending.

The broadest budget categories are national defense, human resources, physical resources, net interest, other functions, and undistributed offsetting receipts. National defense, net interest, other functions, and undistributed receipts are pretty self-explanatory; human resources includes welfare and health-care programs, entitlements such as Medicare and Social Security, and education spending. Physical resources means things like energy development, transportation, natural resources maintenance, environmental conservation, and community- and regional-development programs, the “infrastructure” we’re always going on about.

[….]

Recap: In GDP terms, we spend about a third on the military today compared to what we spent in the late 1950s. We spend almost exactly the same on interest on the debt. We spend 20 percent less on energy, transportation, the environment, and natural resources. And we spend almost four times as much on welfare. Again, that is in GDP terms, and our economy is a heck of a lot bigger than it was in 1957. As a share of all federal spending, welfare has gone from 23 percent of spending to 73 percent of federal spending. In constant-dollar terms, we spend 17.5 times as much. In nominal-dollar terms, we spend 150 times as much.

(Read It All)

Michael Medved dismantles a callers charge that we (as a country) spend more on the military than education and other social programs (2009).

One General says that 4% on military (GDP) if the floor… very bottom… we should not go below this percentage: Admiral Mike Mullen, former Chairman of the Joint Chiefs of Staff, has called four percent an “absolute floor” (New York Times). Here Forbes explains a bit:

Bullets vs. Band-aids: Is Health Spending Crowding out Defense?

….But as an empirical matter, the share of GDP absorbed by federal taxes has been astonishingly stable since 1946—averaging less than 18 percent and exceeding 20 percent in only one year (2000).[3] The president’s own budget shows federal receipts going no higher than 19.2 percent of GDP by 2017. But he has put us on a path that his own Department of Treasury has declared is “unsustainable.” Why? Because health entitlements under Obamacare will grow so rapidly that federal spending as a share of GDP will grow by more than 40 percent by the year 2085. Rising health entitlements will account for every penny of that increase!

With projected federal spending topping 34 percent of GDP and the known politically acceptable levels of federal tax revenues falling below 20 percent of GDP, we are between the proverbial rock and a hard place. Being able to afford even 4 percent of GDP for national defense—we’ve averaged 6.4 percent since 1946—will grow increasingly problematic. This is not just some future hypothetical: as it is, we currently are spending $50 billion less on defense in FY2013 than outgoing Secretary of Defense said just two years ago would be needed this year. And remember that Obamacare spending kicks in with a vengeance in 2014.  Thus, the choice between bullets and butter will be harder to make each year we keep kicking the can down the road instead of addressing health entitlements….

While the following video is about Bernie Sanders… the portion starting at about the 4:54 mark:

In another excellent “myth busting” article at The Heritage Foundation, we read some examples of the importance in the GDP metric for healthy ~MILITARY~ spending:

Defending Defense:
Setting the Record Straight on US Military Spending Requirements
(To see references, download PDF)

Myth

Additional defense spending is unnecessary as the United States already spends more on defense than half the world combined.

Fact

No other country in the world has the enduring vital national interests of the United States, and therefore the U.S. military has global reach and responsibilities. Comparing the unique needs of U.S. security and the resources required against those of other countries is misleading. Further, it is not surprising that the richest nation on earth and history’s “sole superpower” should have a first-rate military; the overall dollar cost is mostly a measure of the size of our economy. What is surprising is that we get so much from such a small proportion of our wealth. As Mackenzie Eaglen of the Heritage Foundation writes,

Defense spending is near historic lows… Between 2010 and 2015, total defense spending is set to fall from 4.9 percent to 3.6 percent of gross domestic product (GDP), even though the nation has assigned more missions to the military over the past two decades.[1]

A narrow focus on strictly dollar figures is also misleading. Consider China’s military budget, which Beijing claims is $78 billion for this year. The Pentagon estimates that the relative “purchasing power” of the Chinese military is actually closer to $150 billion, in good part because China does not have to pay their soldiers, sailors, and airmen anything comparable to what the United States pays its servicemen and women.[2]  By this yardstick, China moves from fifth place in overall military spending among the nations of the world to second.[3] And more to the point, China’s defense expenditures are focused primarily on gaining military leverage in a distinct region of the world—Asia—while the U.S. military has responsibilities everywhere. The resources the U.S. military can actually deploy “in theater” are not vastly superior to those of the Chinese. Simple comparisons of defense expenditures are deceptive measures of the unique needs of America’s armed forces.

Myth

Pentagon budgets were a “gusher” of new money in the Bush Administration.

Fact

In his recent drive to cut overhead, Defense Secretary Robert Gates indeed described the emergency supplemental appropriations for the costs of Iraq and Afghanistan as a “gusher.”[4] But as AEI’s Gary Schmitt and Tom Donnelly have written,

The budget increases that have occurred…are largely tied to fighting the wars. When Bill Clinton left the White House and Dick Cheney told the military that “help [was] on the way,” the defense burden stood at 3 percent of GDP—a post-World War II low. When George W. Bush headed out the door, the figure for the core defense budget was about 3.5 percent. This is an increase, to be sure, but not one to make the military flush after a decade of declining budgets and deferred procurement.[5]

One of the consistent and correct purposes of the wartime supplementals was to “reset” the force—to return the military to at least pre-war readiness levels. This goal is still a long way off. The backlogs at service repair depots will take years to work through.

More profoundly, very little wartime funding went to increase the number of U.S. ground forces. The strains on soldiers and Marines—reflected in rising suicide rates, for example—have yet to be fully calculated. And despite the withdrawal of combat forces from Iraq and President Obama’s deadline for drawdown in Afghanistan, the Army and Marine Corps will continue to deploy overseas for years, an effort that can only be sustained by a reduced pace of operations, sharing the constant burden across a larger force.

There is a moral obligation not only to bind the wounds and tend to the families of those who have fought so well and so long, but also to give them what they need to continue to answer the call to service. Further, the government’s Constitutional obligation is to “provide for the common defense,” and to “secure the blessings of liberty” now and for future generations. This is the government’s fundamental obligation to its citizens and its cardinal contribution to our liberties.

[….]

Myth

Current levels of defense spending are unaffordable.

Fact

The defense budget is a relatively small slice of the $14-plus-trillion American pie. And it’s a shrinking slice: as a percentage of our economy and as a percentage of the federal budget, the burden of defense is declining. President Obama’s long-term budget projections also reduce Pentagon spending in real dollars.

Moreover, the idea that defense cuts will restore fiscal health simply does not add up: suppose Pentagon spending for 2011—$720 billion—were eliminated entirely.[7] This would only halve this year’s federal deficit of $1.5 trillion. And defense spending is a drop in the ocean of today’s $13.3 trillion of government debt. From the Korean War to the collapse of the Soviet Union, total U.S. defense spending was about $4.7 trillion.[8] So had there been no military spending at all during the Cold War, the savings would not equal even half our current national debt.

Talking about defense spending in isolation while discussing the overall federal budget is also misleading. Defense is not the source of the federal government’s fiscal woes. As Mackenzie Eaglen notes,

The substantial decline in the defense share of the budget largely reflects the dramatic growth of entitlement spending. Entitlements now account for around 65 percent of all federal spending and a record 18 percent of GDP. The three largest entitlements— Social Security, Medicare, and Medicaid—eclipsed defense spending in 1976 and have been growing ever since. If future taxes are held at the historical average, these three entitlements will consume all tax revenues by 2052, leaving no money for the government’s primary constitutional obligation: providing for the common defense.[9]

Over the past decade, necessary defense spending increases are responsible for less than 20 percent of all new spending from 2001 to 2009. This does not even include 2009 stimulus spending totaling $787 billion, with almost no money for defense.

Myth

The United States should not be “the world’s policeman.”

Fact

At a cost of less than one nickel of the American taxpayers’ dollar—and only 4.9 percent of U.S. GDP—the United States has fought two wars and provided the essential backbone for a system of global security; by any measurement, it’s an amazing bargain.[10]

The investments made during the Cold War—including the Reagan build-up— continue to pay global dividends. Europe, for the first time in centuries, enjoys a durable peace. East Asia, for millennia a theater of violent competition, is emerging as an economic dynamo, lifting hundreds of millions out of poverty.

Yet this peace and the prosperity it helps to create are not self-generating or selfsustaining. No other nation, or group of nations, is ready, willing or able to take on America’s role. As the Quadrennial Defense Review Independent Panel observed, the future is

…likely to place an increased demand on American “hard power” to preserve regional balances. While diplomacy and development have important roles to play, the world’s first-order problems will continue to be our security concerns….As the last 20 years have shown, America does not have the option of abandoning a leadership role in support of its national interests….Failure to anticipate and manage the conflicts that threaten those interests…will not make those conflicts go away….It will simply lead to an increasingly unstable and unfriendly global climate and, eventually, to conflicts America cannot ignore.[11]

In short, the cost of preserving America’s role in the world is far less than would be the cost of having to fight to recover it or, still greater, the cost of losing it altogether. While many Americans would prefer to see our allies and partners play a larger part in securing the blessings of our common liberty, no president of either political party has backed away from America’s global leadership role —a bipartisan consensus that remains strong evidence that American leadership is still necessary to protect the nation’s vital interests.

The American Enterprise Institute (AEI) makes the continuing point of just-how-much burden is put on the U.S. military around the world (Defense Spending 101 PDF):

We are spending more on our military than half of the rest of the world combined is spending on defense. Do we really need to spend that much?

Questions about what America spends on defense versus what other nations spend on defense should be understood in the context of what we ask our military to do, what our role in the world is, and who our enemies and adversaries are and are likely to be.

From the Cold War to the post-9/11 world, US spending on national defense has given our country a military preeminence that, in turn, has yielded enormous strategic returns by:

  • Protecting the security and prosperity of the United States and its allies;
  • Amplifying America’s diplomatic and economic leadership throughout the globe;
  • Preventing the outbreak of great-power wars that marked previous centuries;
  • Preserving the international order in the face of aggressive, illiberal threats.

As the congressionally mandated, bipartisan Independent Review Panel of the Quadrennial Defense Review spelled out, this has required a military that has four “enduring” tasks:

  • Defense of the homeland
  • Assuring access to the sea, air, space and, now, cyberspace
  • Preserving a favorable balance of power across Eurasia that prevents authoritarian domination of that region
  • Providing for the global common good through such actions as humanitarian aid, development assistance, and disaster relief

These are obviously large tasks, requiring significant military resources. They are also complicated, as the panel also notes, by five global trends:

  • Radical Islamist extremism and the threat of terrorism
  • The rise of new global great powers in Asia
  • Continued struggle for power in the Persian Gulf and the greater Middle East
  • An accelerating global competition for resources
  • Persistent problems from failed and failing states

The strength of this global international order provides America and its allies with real security at a low price while imposing tremendous costs on would-be adversaries. Consider the case of China’s rise. Over the past generation, China’s meteoric economic development has also allowed for a steady, now two-decades-long program of military modernization. Estimates are that Beijing now spends about $170 billion per year on its formal defense program, but that figure would be considerably higher if the Chinese military had to pay its soldiers, airmen, and sailors’ salaries comparable to what their counterparts in the US military earn.

Moreover, China’s expenditures are focused primarily on gaining military leverage in a distinct region of the world—Asia—while, as noted above, the US military has global responsibilities. The tasks in this equation are disproportionate: America seeks to keep the peace in East Asia because it is a vital element in the international system and important to America’s interests. while East Asia seeks to disrupt the regional balance and have no comparable stakes elsewhere.

The fact that we can afford to maintain a military capable of keeping the great powers of the world at peace is a bargain at four cents on the dollar. And the fact that our allies. including former adversaries, have renounced the use of force except in support of American-led coalitions should be thought of as a triumph. The further fact that a potential challenger like China has such a steep hill to climb is an advantage to maintain: it would be preferable to deter China than to fight her.

Larry Elder v. Tavis Smiley w/Reagan Stats (Updated Graph)

Published by Papa Giorgio

The larger interview of both Tavis Smiley and Cornel West can be found here: http://tinyurl.com/ls6nrtw

In this portion Larry Elder deconstructs Tavis Smiley’s view of Ronald Reagan and his impact on the black community in the 1980’s. In fact, even though Tavis promises to rebut Larry’s stats… to date Larry has received no such response. And Larry often notes this in his radio show and in writing:

Black America — What if Obama Were White?

…Smiley: Every stat you cited, vis-a-vis people of color, does not measure up when you talk to the people of color who had to live through the hell of those eight years of Ronald Reagan.

Elder: What do mean, “talk to the people”? I’ve just given you labor stats, census stats — these are facts, Tavis. Unemployment fell faster in the black community than the white community — it fell faster for teens, it fell faster for adults, it fell faster for Hispanics. And you’re telling me when you talk to people, they don’t like Reagan, so therefore stats go out of the window?

Smiley: Larry, your numbers are not true. When I get back to my office, later today or tomorrow, I’ll send you some more numbers. You know this — numbers don’t lie, but people do. The numbers are very clear.

[….]

And Tavis Smiley’s “more” numbers have yet to arrive.

We Spend More on Education than the Military (UPDATED STATS)

Published by Papa Giorgio

UPDATED STATS!!

Total GDP Expenditures on education from 2011 (source): 6.9%

Total GDP Expenditures on the military from 2014 (source): 3.5%

Total GDP Expenditures on health from 2011 (source): 17.7%

(The below was originally Posted April 4th, 2011)

I posted a link to the following audio of Michael Medved [as a response to a challenge from a youngster in conversation elsewhere on the WEB] taking a challenge from a caller on how much we spend on education versus the military.

He challenged the stats used by Michael Medved. I enjoy challenges like these if only it makes me work a bit harder to understand the minutia of the figures involved:

I wanted to post some of the stats here for my future use and set up the discussion as it went on FaceBook:

Young Man

  • Or……. We could just do away with the whole military industrial complex. Sounds allot better to me.

Me

  • How bout the “Educational Industrial Complex?” Your terms are meaningless. We spend more on education than we do on military.

Young Man

  • I’m not sure where you get your facts Sean, but last time I checked The Federal Government spends more on defense than anything else, Espically now sice we are running 3 wars and aid efforts to Japan.

Me

  • Here is a great example of a real world challenge. I have posted this to you in a previous discussion… but i doubt you actually take the time to stop and think critically on these issues, which demand time and reflection. This is only 5-minutes: http://www.youtube.com/watch?v=KV8ITndPp0A

Young Man

  • Yeah i’m sure Medvid gets his stats from Fox as well. Idk, why you gave me a vid of some guy droning on about Bush its really besides the point. Medvid does nothing to further your point either.

I wish to intercede here and mention the derangement syndrome often mentioned  inregards to a few people/organizations. Of course we had versions of this with most Presidential candidates, like Reagan. But I think it really hit a crescendo with President George W. Bush…

Some terms for knowledge:

  • BDS – Bush Derangement Syndrome;
  • PDS – Palin Derangement Syndrome;
  • FDS – Fox Derangement Syndrome.

….Of course Sarah Palin felt this recent wave of hatred, but there is also this liberal transfer of emotion onto whole erganizations. Here I speak of Fox News. In order for this young man to reject facts… all he needed to do was connect the stated facts from Medved to Fox News, and wallah! the facts as well as myself are wrong. So I found the following to back the stats mentioned by Medved. The first comes from Wikipedia — I highly recommend the researcher at heart following the many links involved in this article — and it deals with the total expenditure as % of GDP by country spent on their military:

Rank Country 2009 Spending ($ b.) Share of 2008 GDP (%) World Share (%)
1 United States United States 661 4.3 43
2 People's Republic of China Chinaa 100 2.0 6.6
3 France France 63.9 2.3 4.2
4 United Kingdom United Kingdom 58.3 2.5 3.8
5 Russia Russiaa 53.3 3.5 3.5
6 Japan Japan 51.0 0.9 3.3
7 Germany Germany 45.6 1.3 3.0
8 Saudi Arabia Saudi Arabiab 41.3 8.2 2.7
9 India India 36.3 2.6 2.4
10 Italy Italy 35.8 1.7 2.3
11 Brazil Brazil 26.1 1.5 1.7
12 South Korea South Korea 24.1 2.8 1.6
13 Canada Canada 19.2 1.3 1.3
14 Australia Australia 19.0 1.8 1.2
15 Spain Spain 18.3 1.2 1.2

This next section deals with the total expenditure as % of GDP by country spent on education:

# 1 United States: 7 % of GDP
# 2 Denmark: 6.7 % of GDP
# 3 Sweden: 6.5 % of GDP
# 4 Canada: 6.4 % of GDP
# 5 France: 6.1 % of GDP
# 6 Australia: 6 % of GDP
# 7 Norway: 5.9 % of GDP
# 8 New Zealand: 5.8 % of GDP
= 9 Switzerland: 5.7 % of GDP
= 9 Austria: 5.7 % of GDP
# 11 Finland: 5.6 % of GDP
# 12 Belgium: 5.5 % of GDP
= 13 Germany: 5.3 % of GDP
= 13 United Kingdom: 5.3 % of GDP
# 15 Italy: 4.9 % of GDP

And this final section deals with total expenditure as % of GDP by country spent on health services:

# 1 United States: 13.9 % of GDP
# 2 Switzerland: 10.9 % of GDP
# 3 Germany: 10.8 % of GDP
= 4 Canada: 9.4 % of GDP
= 4 France: 9.4 % of GDP
= 4 Greece: 9.4 % of GDP
# 7 Portugal: 9.3 % of GDP
# 8 Iceland: 9.2 % of GDP
# 9 Australia: 9.1 % of GDP
# 10 Belgium: 9 % of GDP
# 11 Sweden: 8.8 % of GDP
# 12 Denmark: 8.6 % of GDP
# 13 Netherlands: 8.5 % of GDP
# 14 Italy: 8.3 % of GDP
# 15 Norway: 8.1 % of GDP

So let us do some addition and subtraction. Without the wars in Afghanistan and Iraq, military spending would be around 3.2% of the total total expenditure of GDP. Let us now add health and educational services: it would equal 20.9% of the total total expenditure of GDP.  Obviously the “Industrial Complex” lays more in education and health worker/government unions than in the military! One article makes the following comparison and then asks where he can sign up to this free stuff:

….Medicare spending in 2010 was five times the amount it was just thirty years ago. Medicaid spending is up six fold – as a percentage of GDP. In 1971 the federal government spent 1% of GDP providing health care to the elderly and the poor; now they are spending 5.5%. That is not a sustainable growth trend.

Year Medicare Medicare Medicaid Medicaid

% GDP Spending % GDP Spending

1971 0.7% $7.5 billion 0.3% $3.4 billion

2010 3.6% $520 billion 1.9% $273 billion

Once you add in Social Security and income security (welfare) spending, entitlements now account for 13.2% of GDP compared to just 6.7% in 1971. How, when the country is wealthier today than it was in 1971, can more people be entitled to more free stuff than ever before? The sense of entitlement is astounding. Plenty of people in the US believe they are entitled to other people’s money by merely gracing the country with their presence. The bottom 40% of income earners already faces no federal income tax liability, yet they feel entitled to free stuff. Seniors feel entitled to generous Medicare payments, but they didn’t contribute enough money during their working years to even come close to paying for their own medical bills in retirement. Again, they feel entitled to other people’s money.

All play and no work will make the US a poor country. At what point are the actual US taxpayers entitled to expect others to work and help pay the bills? Is there a section of society that is permanently entitled to sponge off of everyone else with no strings attached? If so, where can I sign up?

…(read more)…

What needs to change is the U.S. getting out of security issues Europe should worry about more than we should!

We need to clean our own fiscal house and not worry about others.