How big should government be?
Where does the U.S. stand with respect to other nations
How big is our government?
I have often heard that our government should be smaller. This leads me to a number of questions. How do you measure the size of government? How big is our government? What is the right size for a government to be?
Neither having no government, nor all of a country's economic activities being subsumed by government sound like particularly good ideas to me. The places with no government, say Somalia or Afghanistan, don't seem like they provide nice conditions to live under. I like the idea that there are police to defend me if someone bullies me, steals my things, or does worse to me. Given the state of the world, it seems like having a military to defend the sovereignty of our country also seems like a good idea. So, no government is ridiculous. Countries that have tried to make all activity subservient to the government also seem not to be paradise on earth. I traveled to the Soviet Union, when it still was the Soviet Union. It looked pretty drab to me, and its citizens looked pretty dour. The joke members of our tour group told was: "What do you call someone who smiles in the Soviet Union? A: a tourist."
The only reasonable way I can think to measure the size of government is to consider the portion of GDP that is spent on government versus other activities. I serendipitously discovered a Web site that had already compiled this information for almost every nation on earth. The graph to the upper right is derived from the data on that site.
My impressions: The countries at the extreme ends of the graph are hell holes. There are places that I wouldn't mind living that spend more than we do on government, and there are nice places that spend less. The real problem we seem to have is that while our spending is in the upper two thirds of the chart, our revenues are in the lower two thirds of the chart.
Personally, the argument that government is too big and needs to be smaller, seems to be putting the cart before the horse. Shouldn't we first figure out what services we absolutely want our government to provide, and what we are willing to pay? That is the way I manage my own household budget. The argument that under no circumstances should we raise taxes seems very rigid and potentially disastrous to me. In my own life, if I want to maintain a certain lifestyle, I have to find a way to pay for it.
Another thing that caught my attention is that the vast majority of governments spend more than their revenue. It is probably human nature to want one's government to provide a bit more than what you pay for. I think that is ok, as long as, the excess is sustainable, either because it is small, the economy is growing sufficiently to pay for the debt in the future, or there is another source of income for the government, such as, oil for Middle Eastern countries. Given that, talk that we need an absolutely balanced budget sounds a little hysterical to me, but, then again, we are pretty far away from a balanced budget.
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