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Economic Commentary

Does the Federal Government Spend Too Much?

The Reagan administration has set itself to the herculean task of reducing the growth of federal spending. The administration plans to trim approximately $5 billion from the current budget (FY 1981) and approximately $41 billion from the FY 1982 budget. At the same time, the administration proposes to increase military spending and maintain basic services to the poor. Although the task of slowing federal spending is not insurmountable, skepticism is a natural reaction. In addition, the Reagan administration is proposing budget cuts, while weak economic activity is automatically increasing expenditures in such areas as unemployment compensation.

The views authors express in Economic Commentary are theirs and not necessarily those of the Federal Reserve Bank of Cleveland or the Board of Governors of the Federal Reserve System. The series editor is Tasia Hane. This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License. This paper and its data are subject to revision; please visit clevelandfed.org for updates.

Suggested Citation

Humpage, Owen F. 1981. “Does the Federal Government Spend Too Much?” Federal Reserve Bank of Cleveland, Economic Commentary 2/9/1981.

This work by Federal Reserve Bank of Cleveland is licensed under Creative Commons Attribution-NonCommercial 4.0 International