The Most Negative Leading Economic Indicator

Will we look back on 2009 as the tipping point where productive resources began to spiral faster and faster into the government black hole?  A few stories that have caught my eye the last few weeks:

Federal salaries exploding, from USA Today via Q&O


Federal employees making salaries of $100,000 or more jumped from 14% to 19% of civil servants during the recession's first 18 months "” and that's before overtime pay and bonuses are counted....




Government Employment Rising, via Glenn Reynolds


Government services rising as a percent of the economy (from the Heritage Foundation via the same Glenn Reynolds link above)


Capital to private firms is increasingly allocated by the state -- the new Corporate State.  First, Representative Paul Ryan in Forbes:



Further, via Reuters:






The Government has gained new power to allocate capital in the future. This was perhaps one of the most under-reported stories of the last few months (mea culpa as well).




Here are some of the nuggets I gleaned from days spent reading Frank's handiwork:

-- For all its heft, the bill doesn't once mention the words "too-big-to-fail," the main issue confronting the financial system. Admitting you have a problem, as any 12- stepper knows, is the crucial first step toward recovery.

-- Instead, it supports the biggest banks. It authorizes Federal Reserve banks to provide as much as $4 trillion in emergency funding the next time Wall Street crashes. So much for "no-more-bailouts" talk. That is more than twice what the Fed pumped into markets this time around. The size of the fund makes the bribes in the Senate's health-care bill look minuscule....

But don't worry, trust Congress to get at the heart of the financial meltdown

The bill calls for more than a dozen agencies to create a position called "Director of Minority and Women Inclusion." People in these new posts will be presidential appointees.

  • stan

    It will never be easier to run a political campaign in our lifetime than it should be to run against all this in November. If the GOP can't win then, they should abandon politics.

  • Roy

    It doesn't bother me whether the 'phants can win vs the donks. Folks vote for change, don't ya know. That the 'phants helped create the mess does bother me. I have little reason to expect that their party has learned not to do what it has done.

    Rather than legislators reading spending bills before voting, much as I endorse that practice, I'd rather they read Orwell, Huxley, CS Lewis (That Hideous Strength outdoes both Huxley and Orwell), Rand, and Solzhenitsyn and then (or maybe these first, perhaps because Rand and Solzhenitsyn, as all Russian authors, don't write short books) Frederic Bastiat's "The Law", some Ludwig Von Mises, some Hayek.

    Mene mene tekel upharsin.

  • DrTorch

    Gov't salaries have been skyrocketing for many years now. It's why Fairfax County often has the highest per capita income in the country. And why Maryland has that title at the state level.

    It isn't just "official" gov't salaries, it includes contractors (yes that includes me). And private companies send (well-paid) lobbyists and Bus Development people to work the area.

    And salaries rise quickly b/c it's easy to leverage 1-2 years experience from one job to get a promotion for another job.

    This is a nasty spiral, b/c the DC high cost of living means you need high salaries to recruit new people, and that just drives the cost of living higher. Modest restaurants charge high prices, b/c it's hard to find workers who live close. Same with retail and other low-skill occupations. Fairfax Cty was even suggesting increasing taxes to pay school teachers, fire fighters and other "essential" county employees who could no longer afford to live where they worked.

    And all of this while producing very little. Gov't produces little of value (power point presentations don't really count) so it's taking billions from the economy and producing nothing for it. In fact many regulations impede the economy.

    Sorry, guess this got long-winded. My original point was that this has been going on for some time.