Tuesday, December 23, 2014

The complete series, government spending and growth

Here it is.  Government spending as a share of nominal GDP (Blue) and real growth (red).  Clinton: Government spending down by 6%, growth up 2%, peaking at 4% in the late 90s.  Bush: Government spending trending up,  real growth trending down until we crash.  Post Bush: Government spending shooting straight up from the start of the crash until 2009, and growth down 3%.  2010, real growth back to Bush levels and government spending starts to decline.

Any regression on this series will show that government spending increases have been negative through the past two recession cycles and since 2009.  There is a possible one year of ambiguous data in 2002.  No Keynesian anywhere will ever publish this graph or perform some regression. We can expect Cristina Romer to cut and paste and confirm her priors, but there will be no honest analysis by any Keynesian, that is a well known fact.  Keynesians are almost always fraudulent unless their priors are confirmed.

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