Just the Facts: How the Federal Budget Has Changed Over the Last 30 Years
"Hi Morgan. Can you write an article showing how the federal budget spending and taxes have changed in the last 30 years?"
-- Reader Mike M.
I dug through historical data from the Office of Management and Budget. Here's how things have changed over the last three decades:
Federal Spending as a Percentage of GDP
Defense down, Medicare up, overall spending pretty much flat -- that's the best way to sum up the change in spending between 1983 and today.
Now here's tax revenue:
Federal Tax Revenue as a Percentage of GDP
The 2013 fiscal year ends in October. 2014's projected figures show spending as a percentage of GDP at 22.2%, and taxes at 17.8%.
So, the big story is: After five years of deep deficits from a spike in spending and plunge in tax revenue, things are pretty close to normal in budget land. Both spending and revenue will be within one percentage point of their respective 30-year averages as a percent of GDP next year.
How we'll manage a $16 trillion debt and deal with future problems with health care costs is another story. For that, I encourage you to check my new report, "Everything You Need to Know About the National Debt." It walks you through with step-by-step explanations about how the government spends your money, where it gets tax revenue from, the future of spending, and what a $16 trillion debt means for our future. Click here to read it.
The article Just the Facts: How the Federal Budget Has Changed Over the Last 30 Years originally appeared on Fool.com.Follow Morgan Housel on Twitter @TMFHousel. The Motley Fool has a disclosure policy.
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