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Florida Government Spending Report
REPORT SUMMARY
by Michael Hodges
- notice > updated March 2004 -
- a chapter of the Grandfather Economic Reports - |
Introduction:
Responsible government management would assure that its spending share of the economy
would not increase over time. In fact, efficiently & responsibly managed government
should deliver services such as to increase its spending at a slower rate of growth than
that of the general economy. To do otherwise would be to reduce the relative share of the
private sector, which is the prime engine for productivity and growth of living standards
for the citizens.
Likewise, government employment should not increase faster than the growth of the
general population it serves. In fact, efficient government would grow its headcount at a
slower rate.
This report documents a review of the performance of Florida's state and local
government with a macro view of size and trends relative to the past. The findings are
most disturbing. Following is a summary table with an interesting trend chart:
LONG-TERM TREND: GOVERNMENT SHARE OF ECONOMY RISES
PRIVATE SECTOR'S SHARE DECLINES |
 This chart shows the decline of share
of Florida's economy of its private sector, the declining
blue bars - from 1947 to 1963 to 2000.This decline is caused by two
factors >
1. the increase of the share of the economy caused by state and local government
spending growing at a faster rate than the economy as a whole, thereby increasing its
share - - as shown by the advancing brown bars.
2. the increase of the share of the economy caused by federal government spending also
growing faster than the economy as a whole, thereby increasing its share - - as shown by
the advancing yellow bars.
The left side of the chart shows 1947, when Florida's government spending consumed 6%
of the economy. The right side bar shows in 2000 this spending ratio had increased to 19%,
meaning it had grown 3 times faster than the economy from 1947 to 2000.
The left side also shows 1947 federal government spending ratio was 16% of the economy,
growing by 2000 to a 23% share (By the way, the federal spending ratio for 2003 is 26% of
the economy).
As the Florida's state & local governments increased their spending ratio 13 points
of the economy (from 6% to 19%), and as the federal government increased its ratio 7
points (from 16% to 23%), their combined increase was 20 points (from 22% to 42% of the
economy). This government growth came at the expense of the private sector (declining blue bars) losing 20 points in its
share, from 78% of the economy in 1947 (see chart' left blue bar) to 58% of the economy in
2000 (see chart's right blue bar).
Socialism can be equated to government spending, and the degree of socialism in a
nation can be equated to its government spending as a share of the economy. In Florida,
therefore, we assign Florida as being 42% socialistic (19% state & local government
plus 23% federal). As shown on the chart, socialism has gained significant ground in
Florida in those 53 years. |
Spending summary:
Spending by Florida governments in 2000 consumed more than a 19% share of the
state's economy, compared to 12% in 1963 and an estimated 6% in 1947. (that's 7% of the
economy transferred to government from the private sector since 1963, and a total
subtraction of 13% of the economy since 1947). Florida's state & local government
spending in 2000 was, compared to 1963 spending ratios, $31 billion (or, 61%) too much in
2000; and $57 billion too much compared to 1947 spending ratios to Gross State Product
(GSP) (compared just to 1963, excess state direct=$12 billion; excess local=$19 billion).
Spending grew 60% faster than the economy. The free-market private sector's
relative size (not dependent on government spending) was thereby dramatically reduced.
NOTICE: For charts on spending broken down into state vs. local government, see the FLORIDA GOVERNMENT SPENDING
REPORT PAGE
Headcount summary:
Employment by Florida state & local governments in 2002 was 789,000. That's 67%
higher than it should be if said governments had not grown faster than the
general population since 1957. But, they grew 2X faster AND if they had improved
productivity the count should have been even lower. That indicates a minimum 317,000
excess government employees (70,000 state, 247,000 local). By 2004 this excess
increased to 333,000 employees. Interestingly, in the last several years the state excess
employee count stopped increasing, and in fact came down a bit, but city/local governent
excesses continue to rocket upward.
NOTICE: For charts on government employee trends, see the FLORIDA GOVERNMENT EMPLOYEE
REPORT.
Composite: There are many apologists with many
'justifications'. The author submits that most will not hold water. Several examples:
There are many vital services, such as refuge collection, that are not performed by
government employees, as in the past - - There is significant evidence that today's youth
are not being as well educated to meet their future, as were prior generations to meet
theirs, and the percentage of youth in the population is not growing. For a nation
designed for limited government, there can be zero excuse (in peace-time) for government
to expand and control a larger share of the state economy, than was the case for prior
generations - - with responsibly managed government the share should have been less than
in prior generations. The economy is much too government spending dependent - - an
unhealthy status.
The contents of this report call for a reversal of past trends of government in
Florida, which have expanded faster than the economy - - and, to return ratios of direct
spending and headcount to prior ratios.
Such cries out for major PRIVATIZATION of large segments of government in
Florida, at all levels - - and, reduce revenues accordingly. Some apologists may insist
that the road traveled to date was because 'society required it.' The author
challenges such rationalizations. The proof of what services are needed is to
privatize them and let the free-market determine what is truly needed (and at what price)
by free citizen choice.
The reader is now directed to the Florida State & Local
Government Spending Report and Charts - the meat, and following that to a
look at headcount trends, and from there you will be directed to three other pages:
Headcount, and Private Sector.
NOTICE: from here you can return to the Florida HOME PAGE index of
subjects and select a section.
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