Federal discretionary spending keeps going ... sideways

Justin, I'm sure you're right that most people omit "Defense, Social Security and Medicare" from their criticism of "big government." But I never really bought the comparison to spending as a percentage of GDP as conveying much useful info.Assuming GDP increases tremendously over time, it's not obvious at all that we want our government to grow proportionally. The burden is on the party proposing spending to show why it should be a function of US wealth.A better figure to correlate spending to is probably population; it's much more intuitive why we need more road area and court capacity -- to name two non-controversial types of gov't spending -- with more people present. But that obviously doesn't hold for all spending (e.g., defense). Too much detail now, especially for such an uphill battle. But I hope I'm not unreasonable in my complaint.

Per capita would be another measure, but I think it's distracting from what ought to be the main issue (especially if we're talking about people who complain of "big government," as your post begins). That issue is the small-government advocate's (implied) assertion that much government spending ought to be basically fixed; once $x is spent on defense, $y is spent on courts, and so on, the additional cost of government over time seems to only need to vary as a function of population size (and even there, only for some things). So as the US gets richer, both of these measures ($/per capita and % of GDP) should shrink over time.

Since the graph is already expressed as a % of GDP, you should not make any adjustments for inflation because inflation changes are already baked into GDP. In math terms, both the numerator (federal non-discretionary spending) and the denominator (GDP) are nominal values which include inflation so any inflationary effects cancel.

Spending as % of GDP is a good technical measure, but not a normative one that we should make policy upon. The reason is this: we have to work hard to create our GDP each year. It's not an endowment like wealth that we inherit and divide up each year without enduring any pain.

As we earn more $ of GDP/capita, we should always ask ourselves whether we want to spend these hard-won sums on more government programs now or whether we'd rather each have the option to spend or save them for the future as we please.

We should also keep in mind that any government programs will be developed by politicians, at least some of whom we must believe are poorly informed if we have any political beliefs, and that they will be administered by bureaucrats whom we don't expect to be quite as efficient in producing most goods as private workers.