A considerable portion of the population has thereby been persuaded that it is not a disgrace to adopt the mind set of beggars, whiners, and thieves when it comes to debating public policies. By 1994, nearly 75 percent of federal government's nondefense spending was of this type. Of course, this spending is not distributed equally. Others receive less. Nonetheless, the current American economy seems lethargic by past standards.
Real wages appear to have stagnated for the last two decades.
Between the inefficiencies inflicted by excessive regulation and the oppressive burdens of taxes extracted to support the massive spending increases of the federal government over these last five decades, the economy has fallen far short of its potential. To get an inkling of how far short of its potential the economy has fallen, let's consider the question of opportunity cost. That is, what the situation might be today if a different path had been chosen in 1945. While measuring the opportunity cost of excessive regulation would be difficult, if not impossible, we can get a glimpse of what the magnitude of such an opportunity cost might be in the case of excessive spending. For our thought experiment, we will consider what might have happened if the federal government's per capita nondefense spending had remained at the level in effect in 1945.