The Truth About Federal Spending

The Truth About Federal Spending

Federal Reserve research chart

A bit of economic wonk from Paul Krugman on his NYTimes blog:

The Truth About Federal Spending – NYTimes.com.

A 6 percent fall in GDP relative to trend, all by itself, would have raised the ratio of spending to GDP from 19.6 to 20.8, or about 30 percent of the actual rise.

That still leaves a rise in spending; but most of that is safety-net programs, which spend more in hard times because more people are in distress.

hat tip: Paul Krugman on Twitter