The Administration’s Budget, released February 2, 2015, saw its shadow and is predicting at least 12 more years of ever encroaching federal government, rising taxes, and a more well defined Nanny State. Based on Table S-4 “Adjusted Baseline by Category”, outlays are expected to increase by more than 80% from 2012 to 2025.

This diagram simply illustrates nominal expenditure by the federal government. A much better indicator of the size of the federal government is spending as a percentage of GDP. Over the same timeframe spending as a percentage of GDP is planned to increase from 20.3% to 22.2%. This nearly 2% increase relative to GDP does not look nearly as ominous as the nominal increase in expenditure, but it is certainly not indicative of anything other than continuous growth in our federal government. Also examination of the rate of growth of outlays as a percent of GDP shows that much of the increase is planned for the next several years.

Also as all Administrations will do, economic growth projections are very optimistic (and hence optimistic expectations for GDP growth). Another telling feature of this 2016 budget is to examine growth of defense spending compared to overall growth of outlays.

We are in a time where our nation is threatened by terrorism and the defense budget is increasing much slower (less than 30%) than other expenditures. This is par for the course and to be expected. Of further interest is the expected increase in net interest.

If interest rates do increase net interest could be a very significant drag on what our government would like to do. So, the Obamaian groundhog predicts several more years of intensive governmental growth.