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Sunday, September 16, 2007

New Cons for Old

In his review of Jonathan Chait's "The Big Con" Paul Krugman takes a trip down memory lane to the days before Aurthur Laffer drew a curve on a napkin.

Way back in 1964, in his famous speech on behalf of Barry Goldwater, Reagan talked about how crazy it was that the federal government employed 2.5 million civilian workers; nobody pointed out that two-thirds of those civilians worked either for the Pentagon or for the post office.

Indeed. Criticizing the bloated Federal Bureaucracy was the supply side economics of the 60s and 70s. Conservatives loved to cite Parkinson's law. There were, then as always, immune to facts. I think Krugman may assume that that Canard has been finally chained (or more likely doesn't want to waste pixels). Of course it hasn't. Many people in the USA think the Federal Government blows huge amounts of money on federal bureaucrats. This is so false that it is amazing. Back in 1964 there were about 2.5 million civilians working for the federal government. In 2005 there were 2,709,000 or less than 2% of total employment. Since 1964 total employment has more than doubled. The fear of Parkinson's law has lead to constant efforts to cut the size of the Federal Bureaucracy. They have been successful. It's not that way in most developed countries and is a wonderful thing (full disclosure my father is a high ranking federal civil servant who has been finding ways to beat the freeze for almost all of his adult life).

It almost goes without saying, that the small over all increase includes a small increase during the Reagan years and a large decline (about 10%) during the Clinton years. The reason, as noted by Krugman, is that the DOD accounts for much of federal civilian employment about 671,000 in 2005 down from slightly over a million in 1992.The Postal service has surpassed the DOD with about 803,000 employees in 2005 so together they are down from two thirds to slightly more than half of federal civilian employment.

The payroll was under $ 153 billion in 2005 out of a total budget of over $ 2,708 billion so less than 6%.

That was based on 5 minutes of googling and reading.

No wonder they had to start looking for a new scam.

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