From: stecher@atlas.socsci.umn.edu (Jack Stecher)
Subject: Re: Rush is bad for our country
Summary: Sigh.
Organization: Department of Economics, Univ of Minn
Date: Mon, 5 Oct 1992 17:32:19 GMT

In article <1992Oct5.105549.1@gacvx1.gac.edu> peckman@gacvx1.gac.edu writes:
>It would be nice if you would realize that conservatism has led to most of our
>country's current woes and if George Bush is re-elected, our country will fall
>even farther behind Japan and Germany both educationally and economically.

No doubt this is what liberals consider a valid style of argument.

>It's time for a change.  Our country needs fewer Rush Limbaughs and more Bill
>Clintons.

Here we have tolerance at its finest.  Perhaps you might stop typing and
instead picked up pom-poms, and composed cheers for Bill Clinton.  You'll be
equally effective, and won't risk deluding yourself about what you're doing.

>Rush spouting off about goofy liberals will get us nowhere.  But
>Bill Clinton as our next president will offer our country something it has
>sorely lacked in the past 4 years...hope for the future!

Bill Clinton, if we take him at his word, will give us Bolshevism, which I
cannot say differs from your hope for our future.  Consider that Clinton
is threating to increase the size of our federal government by 1/6 its
current level.  Presently, the federal government spends about 1/4 of GNP,
so Clinton wants the federal government to be 7/24 of our current GNP.
Add that state and local governments presently account for another 1/4 of
GNP, and we'd be at 13/24 of GNP made up by the government.  Then consider
that much of Clinton's focus is on more aid to local governments; indeed, much
of his criticism of Bush is that Bush has "ignored our cities."  I know of no
federally aided programs run at a lower level for which all the funding comes
from the federal government, or of any for which this has ever been the case
(beyond perhaps some start-up funding).  If Clinton would spend more on local
governments, it is fair to presume that he'd want the local governments to
increase programming, and to kick in their fair share.  Translation: expect
spending at local levels to increase as an indirect consequence of a Clinton
administration.  We are now at government spending roughly 60% of our current
GNP.

This, of course, is before accounting for the fact that government spending
is less efficient than private sector spending.  Even if government bureaucrats
are entirely selfless, there are limits on how quickly governments,
compared with a price system, can respond to a changing economic environment.
The 1990 Rostenkowski-Bush budget accord slowed the economy considerably, at
least in part because of higher taxes and more government spending in the stead
of private sector spending (the result of higher government borrowing).  Is it
fair to assume, then, that Clinton's far more grandiose scheme would have at
least some detrimental effects on output?  Adding in the costs of higher
regulations and the costs on businesses of buying insurance or paying into
Clinton's health insurance pool, I cannot imagine any scenario that leaves
government spending at under 2/3 of GNP if Clinton gets what he wants.

Of course, the Labor Department measures output by GDP, as of about a year
ago, rather than by GNP.  There are many reasons for this, the simplist being
that we keep output statistics largely for making comparisons, and most other
countries use GDP.  Last time I checked, GNP was about $6 trillion, versus
GDP of about $4.8 trillion.  This was a while ago, so let's call GDP $5 t
to be fair to Clinton.  That makes GDP 5/6 of GNP.  Assuming this ratio does
not change, we get government spending under Clinton as 2/3 * 6/5 = 4/5, or
80%, of GDP.

This, of course, ignores that Clinton would have all those not attending
college spend two years in government service.  Since these people are getting
what politicians choose to pay them, and since it's fair to assume that they'll
receive less money than would be necessary to get them to enlist voluntarily
(otherwise, why make it mandatory), we actually have somewhat undercounted.

--Jack Stecher
stecher@atlas.socsci.umn.edu
Newsgroups: alt.fan.rush-limbaugh