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From Peter Orszag's testimony to the House Budget Committee:
The average level of non-defense discretionary spending between 1969 and 2008 was 3.8 percent of GDP. In 2009, such spending is estimated to represent 4.1 percent of GDP.And that includes stimulus spending. One other note from Orszag's comments: The OMB Director goes to great lengths to explain that the proposed spending on priorities like health care is paid for with new revenues and savings. But you'd never know it reading the press commentary. There, it's been basically presented as impossible for the government to reduce the total deficit while also spending money on new priorities. That's just science. You can look it up. I'm increasingly of the opinion that a lot of people have forgotten that federal spending does not have to be deficit spending. To be fair, the last eight years haven't done much to remind folks of that fact. Hundreds of billions went into Iraq and Afghanistan and no taxes were raised nor savings discovered to offset the cost. Hundreds of billions went into tax cuts and no major programs were cut or new taxes implemented to balance the ledger. For the past decade or so, federal spending has been synonymous with federal debt. But it doesn't have to be. The budget, for instance, pulls together $634 billion in new money for health care. Some of that comes from an (effective) tax hike on the upper class. Some comes from squeezing Medicare Advantage insurers. But the sum impact means that Congress could spend $634 billion on health care and not increase the debt by a dollar.Anyway, Orszag's full testimony is below the fold. His charts can be downloaded here. Though I must say: As a longtime consumer -- a connoisseur, even -- of Orszag's chartpacks, this is not his most exciting effort.
