December 30, 2014

ACCOMPLISHMENTS OF AN ALLEGEDLY DO-NOTHING CONGRESS: Federal spending drops to 20 percent of GDP.

The federal budget is shrinking as a percentage of gross domestic product, falling just below 20 percent in the third quarter of 2014. That’s down four points from its peak of 24 percent in 2011, according to market analysis firm Strategas’ survey of recent Treasury Department data.

“That’s a pretty large drop in government spending,” said Daniel Clifton, head of policy research for Strategas.

The drop puts current federal spending close to the norm for the last half-century. While the budget has grown in absolute numbers — the omnibus spending bill passed earlier this month totaled more than $1 trillion — federal spending has averaged just over 19 percent of GDP since 1963.

The decline is due to a combination of factors, the main one being the restraints that were put on federal spending in 2011 as a result of the debt ceiling standoff in Congress.

And, of course, an accomplishment of the Tea Party movement, too.

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