It’s an obnoxious, overly-simplistic question, but it is an important one. Plenty of objective research suggest that the answer is “bigger than ever”. Other datasets suggests “not that big” when compared to advanced economies. However, if we look at a more obscure measurement direct from the exciting Financial Accounts of the United States, there’s a slightly different story.
Federal Government Nonfinancial Assets (think tangible assets like structures, equipment, etc.) have fallen to their lowest level ever, as a share of the economy.
Even more striking is that measurement relative to total wealth, which is currently at a staggering $154 trillion.
Ok, fine, nonfinancial assets don’t tell the full story, obviously. Nonetheless, government expenditures (relative to the size of the economy) are only slightly above their long-run average levels. The interesting thing is the impact of state and local government on these trends. By including state and local government spending, total government is nearing 40% the size of the economy.
