Comment 27235

By A Smith (anonymous) | Posted November 08, 2008 at 19:47:22

Let's take a look at the years 1993 to 2000...Non military spending as % of the US economy, followed by % GDP growth.

1993 28.98 2.67
1994 28.38 4.02
1995 28.61 2.50
1996 28.34 3.70
1997 27.64 4.50
1998 27.13 4.18
1999 26.89 4.45
2000 26.81 3.66

Now let's look at the years 2001 to 2008 (first 2 quarters annualized)

2001 27.60 0.75
2002 28.19 1.60
2003 28.25 2.51
2004 27.75 3.64
2005 27.97 3.07
2006 27.95 2.87
2007 28.70 2.19
2008 29.25 1.84

As you can see from the first set of numbers, when government stops helping the people, the economy takes off.

Contrast that to the Bush years, where government has tried to help the people (new drug entitlement programs, stimulus package) and all that produces is economic pain.

This same effect can be seen anytime government tries spending money to help the citizens.

It all comes down to balance. When government tries to create a better life for the people, the universe balances those efforts out with economic pain.

When government stops helping the people as much, the universe steps in and gives the people a fast growing economy.

Therefore, the next time you here about government cutbacks, don't be surprised when you here that the economy has done surprisingly good in the months following those cutbacks. All you have to remember is that good leads to bad and bad leads to good.

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