Gerald Seib, a respected journalist whose focus is policy coming out of Washington has hit upon a key point that macroeconomists have been noting for years: the government doesn’t do much any more. It can’t. It’s crippled.
Not dramatically, and not necessarily permanently. But in the ways most people think about government—employees on the public payroll running programs—it's actually in decline.
… The part of government that is really increasing right now is the part that churns out checks for people receiving Medicare, Medicaid and Social Security.
Meantime the ranks of government workers at the federal, state and local levels—the bureaucrats everybody loves to hate, as well as more beloved figures such as firefighters—are declining, as is the share of government spending that goes to the programs they run.
What's happening, in short, is that government, particularly at the federal level, is turning increasingly into an entitlement machine, dispensing benefits to those who qualify, while a combination of recession, deficits and an aversion to new taxes is squeezing most remaining government activity.
Read the whole thing, entitled “Hidden Secrets of Spending” in the February 5 issue of The Wall Street Journal.