May 23, 2017
Paul Ryan won widespread applause from the Peter Peterson-types some years back for proposing a budget that would virtually eliminate the federal government by 2050, excepting Medicare, Medicaid, Social Security, and the military. According to the Congressional Budget Office’s analysis of the Ryan budget (done under Speaker Ryan’s supervision), spending on everything other than Social Security, Medicare, and Medicaid would be reduced to 3.5 percent of GDP in 2050. With military spending likely running in the neighborhood of 3.0 percent of GDP, this left around 0.5 percent of GDP for federal spending on education, infrastructure, the Justice Department, research and development, national parks, and all the other things we think of the government as doing.
Well, Ryan now has some serious competition from Donald Trump. In his budget, he has these same categories of spending shrinking to 3.6 percent of GDP by 2027, down from 6.3 percent of GDP at present. While Ryan’s endpoint may be more impressive, it is important to remember that he has another 23 years to get there. According to CBO, in 2030 Ryan’s budget has 5.25 percent of GDP going to the same categories of spending, including the military. If we pull out 3.0 percent for the military (Ryan is more hawkish than Trump, who only spending 2.3 percent of GDP on the military in 2027) then Ryan would have 2.25 percent of GDP for this everything else category in 2030.
So we have Trump at 3.6 percent of GDP for the bulk of the federal government in 2027 compared to 2.3 percent in the same categories for Ryan in 2030. If we assume the same rate of decline in the years from 2027 t0 2030 as in the years 2017 to 2027, then Trump’s budget would be down to 2.8 percent of GDP by 2030. It looks like Ryan is still somewhat ahead of Trump in his plan to eliminate the federal government, but Trump can still hope to catch up.
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