Question

Using the Historical Tables available at the budget Tab of the website of the U.S. Office of Management and Budget, prepare an analysis of the trends in the following data: total federal outlays, total defense spending, and total mandatory spending. Do the analysis in both current and constant dollars. Provide your interpretation of what forces are driving the patterns that you observe. ( Textbook Fiscal Administration by John Mikesell, 10th edition, chapter 4, Question 1)

Answer 1

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These figures are in present and steady dollars.

The Medicare and Medicaid programs were 1.2% of GDP in the year 1975 and achieved 3.3% in 1990s. It diminished to 3.1% in 2000 and developed to 3.6% in 2004. It was 4% in the year 2008 and 4.9% in 2011. It diminished to 4.5% in 2012 and was 4.7% in 2014.

The all out government expenses expanded amid the World War II including the guard spending. At that point, the legislature expanded its spending on the government disability programs. The protection going through expanded with the interest in the human asset programs in 1980s. In 1990s, the spending expanded in light of the funds and advance emergency. It expanded with time and in 2000s, the spending rose in view of wars with Iraq and Afghanistan. Likewise the staggering sea tempests hit in 2005. The year 2008 was the time of extraordinary gloom and was real reason for expanded spending. The expansion in the spending on Medicare and Medicaid programs was seen in 1973 with the withdrawal of protection staff from Vietnam. The transportation costs expanded with the arrangement of better foundation in the economy.