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INTRODUCTION
Econ 432: Chapter I
IN ORDER TO CONSIDER PUBLIC POLICY WE NEED A BASIC UNDERSTANDING OF THE FRAMEWORK IN
WHICH OUR GOVERNMENT OPERATES AND THE SIZE OF GOVERNMENT (AND GROWTH OVER TIME).
Measuring the Size of Government
Ways to Measure the Size of Government
1. Government employment figures given us one estimate of the size of government.
With about_____________________, the Federal
Government, excluding the Postal Service, is the Nation's largest employer.
US Federal Government Structure and Employment
A. The _____________ is responsible for forming and amending the legal structure of the Nation. Its largest component is Congress, the U.S. legislative body, which is made up of the Senate and the House of Representatives. This body includes senators, representatives, their staffs, and various support workers. The legislative branch employs only about ______ of Federal workers.
B. The __________ is responsible for interpreting the laws that are established by the legislative branch. The judicial branch employs about _________ of Federal workers, and unlike the legislative branch, its offices and employees are dispersed throughout the country.
C. The _____________ has the widest range of responsibilities. Consequently, it employed about 97 percent of all Federal civilian employees (excluding Postal Service workers) in 2008. The executive branch is comprised of the Executive Office of the President, 15 executive Cabinet departments, and about 70 independent agencies, each of which has clearly defined duties.
Each of the 15 executive Cabinet departments administers programs that oversee an aspect of life in the United States.
Each department, listed by employment size, is described below and in Table 1 along with the totals for the judicial and legislative branches. You will see that civilian employment is close to 2 million at the federal level.
United States
Total 1,909,000
Executive departments 1,664,000
Defense, total 652,000
Veterans Affairs 280,000
Homeland Security 171,000
Justice 108,000
Treasury 88,000
Agriculture 82,000
Interior 67,000
Health and Human Services 64,000
Transportation 55,000
Commerce 39,000
Labor 16,000
Energy 15,000
State 15,000
Housing and Urban Development 9,000
Education 4,000
Independent agencies 180,000
Social Security Administration 64,000
National Aeronautics and Space Administration 18,000
Environmental Protection Agency 18,000
General Services Administration 12,000
Office of Personnel Management 5,000
Smithsonian Institution 4,000
Other 59,000
Judicial branch 33,000
Legislative branch 30,000
Table 1. Federal Government civilian employment, except U.S. Postal Service, November 2008
Disadvantage of Employment Figures
Employment figures may overestimate or underestimate the importance of government—or the extent to which society’s resources are subject to control by government.
Why?
Measuring Size of Government (continued)
2. Economists typically measure the size of government by the volume of its annual expenditures. These expenditures include
A. Purchases of goods and services• B. Income transfers
C. Interest Payments
Size of US Government 2008
For 2008 total government expenditures were $4.7 trillion dollars.
Of this approximately ____ is done at the federal level; ____ at the state level and ____ at the local level.
(Source: Economic Report of the President 2009),
Measuring Growth in Government
Comparison of Expenditures over time:
In 2008 total expenditures were $4.7 trillion
compared to $2.9 trillion in 2000.
Does this mean that government has grownover time? What else needs to be considered?
Other Considerations
1.
2.
3.
Overview of US Revenues 2008
In 2008, federal revenue was approximately $2.5 trillion dollars.
At the federal level revenue is primarily generated from 3 sources:1.
2.
3.
State and Local Revenue Streams 2008
In 2008, state and local revenue was estimated at $1.9
trillion dollars. At the state and local level revenue
comes from:1. 2. 3. 4. 5.
