The growth of government in USA

Emanuel Steve Savas, Vladimiras Obrazcovas

Abstract


The article examines the size and growth of governments in the United States. The three different measures are used to define the size of government: the number or government units, their expenditures, and the number of people they employ. The number of different government units changes over time. The number of townships has been shrinking while the number of municipalities has been growing, an indication of increasing urbanization and the incorporation of previously unincorporated areas. The number of special districts shoes rapid growth, a reflection of the continuous creation of intergovernmental arrangements to perform various functions in metropolitan areas. As a result, and reversing a prolonged decline that resulted fr om the consolidation of school districts, the total number of government units is growing again. While the total number of governments has been growing slowly in recent decades, their expenditures have been growing rapidly. Total spending by all levels of government in the United States in 1996 was $2.993 trillion. This does not include “off-budget spending,” that is, outstanding federal loans, guaranteed loans, and borrowing by federally sponsored enterprises. In less than 40 years, measured in constant dollars, expenditures have more than quadrupled, almost tripled on a per capita basis, and grown by more than half as a fraction of gross domestic product (GDP), to 32.2 percent. Another measure of the size and growth of government in the United States is the number of employees. In 1995, the number of full-time-equivalent employees, not counting the military, was 19.5 million, about 1 out of every 7 nonagricultural civilian workers. In the forty-five years between 1950 and 1995, the government workforce grew at a compounded annual rate of 2.8 percent, more than four times that of the population as a whole (0.6 percent) and more than that of private-sector employment (2.1 percent). By 1992, more people were working in government than in manufacturing. Three major factors have contributed to the growth of government: (1) increased demand for government services, by current and would-be service recipients; (2) increased supply of government services, by serviceproducers; and (3) increased inefficiency, which results in more government staffing and spending to provide the same services. The demand for government services has increased for several reasons: demographic changes in the population; income growth; income-redistribution policies; the desire to rectify societal ills, avoid risk, and promote culture; fiscal illusion; and preservation of existing programs. Wh ereas increased demand provides the “pull” for more government services, the desire by producers to supply more services provides a “push.” It means gaining votes, budgetary imperialism, enlarging campaign staffs, the problem-finding elite, the therapeutic state, command-and-control policies, government monopolies, employee voting, demand for government jobs and overproduction. A third major factor that accounts for the growth of government is growing inefficiency: spending more money and employing more people to do the same work (overstaffing, overpaying, overbuilding). The three factors discussed in article – recipient demands, producer pressure, and inefficiency – are closed linked. Governments grow in response to public demands, in response to the desires of service producers to supply more services, and as a consequence of inefficiency. If unchecked, these factors would lead to an unstable and uncontrollable spiral of continued growth: the bigger the government, the greater force for even bigger government. Budgets would expand, resulting in the appointment of more officials and the hiring workers. The forecast would appear ominous: sooner or later, everyone will be working for government and government will absorb and spend all of the nation’s gross domestic product.

Keywords


growth of government; size of government; government employment; government expenditures

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"Public Policy and Administration" ISSN online 2029-2872 / ISSN print 1648-2603