Furrow23
19697
1209
25
Nov 19, 2024 3:54 PM
Furrow23
19697
1209
25
OnyxTurret
Gee, did something happen in 2019-2020 that caused a huge amount of spending and inflation? I'm a little foggy...
InvalidUsername8
6,771 USD in 1965 is equivalent to 55,633 USD in 2020. Government spending has gone down relatively.
WebDragonG3
and then there's the reality -- the fact that ongoing devaluation of the dollar has been flattening it against the Y axis since long before Reagan -- I've been on about this for 20+ years to a mostly deaf audience. them chickens gonna come home to roost eventually. and it's gonna be suuuuuuuuuuper ugly. if you thought the Great Depression was bad, just hang on to your hat and witness this unholiness : https://imgur.com/4KipDzB
kydn
Stock piling money increases inflation. Not spending most of your money makes the economy weaker too.
Override9636
Wow, I wonder what happened in 2008 and 2020 that caused those spikes? Was it the housing market collapse from government deregulation and the covid pandemic that virtually froze all business and travel across the globe? Federal government had to increase during those times just to keep people housed and fed, and you would HOPE that they learned their lessons to tighten regulations on mortgages and create better pandemic response plans...except Trump is eliminating all those "inefficiencies"
widiwi
Hey now, you weren't supposed to fact check. /s
Che07
Spacekaren Elmo is a prime foot shooter.
Woogyface
aaaaaaaaand he's banned
jimmythehat1
No the fuck it doesn't. It's a factor, but not a major one.
cgt9803
Governments around the world were deficit spending heavily to prevent collapse during Covid, starting under Trump. Blaming it on Biden is deliberately stupid bait for MAGA morons, and Space Nazi knows it
tadrinth
Pandemics also cause inflation. Any disruption of making and shipping goods makes those goods scarce. When goods are scarce, the price goes up. COVID was a huge disruption to making and shipping goods, so we had global inflation. There's been huge inflation after previous disruptive pandemics as well.
If we hadn't spent a bunch of money, we would have had massive unemployment as well. Instead, we had a little extra inflation and extremely good employment.
DoseOfScience
Personal opinion: the state/local spending should be on the bottom, as it rarely changes, so you can see the changes from the Natl.
Snooj
I have no idea why you're being downvoted. That's a reasonable ask and I agree with the conclusion.
TeDmund
One of my huge pet peeves is people who say "remember" or "a reminder" etc before a piece of misinformation
glocksout
He’s also wrong about what causes inflation. Banks using fractional reserve lending dumps in more money into the money supply than “government overspending” and nobody faults that for inflation.
Temzilla
Japan has been trying to fight deflation for 25 years and has more national debt as a percentage of GDP when compared to any other nation on earth. The two things just aren't really linked at all. US 120% of GDP as debt, Japan, 261% as of 2022.
TeamSpicyTacos
Then why is inflation worse outside the US wanna be Hitler? Also? Did this genius just confuse correlation and causation??
Grenateh
I'm going to become a boomer and just use capslock all the time. GOD HE IS SO FUCKING STUPID I CAN'T FUCKING STAND IT ANYMORE.
FatherNeal
Says the idiot who’s entire fortune is propped up by massive government subsidies to his companies that would utterly fail without them. SMH
Wardonk3y
Regardless of how much they try there's going to be a cross section of the population that are just going to naturally be able to see through their bullshit
ToSisPoS
This is like subscribing to a newspaper that you hate so you can post angry letters to the editor.
Get. Off. That. Fascist. Megaphone.
kmikl
Spending servicing debt like the 7 TRILLION of unfunded debt that gave the people most able to pay taxes the tax cuts they didn't need.
I think it's something like $14T in unfunded debt that's been added since 2000 because of republican tax breaks, but that money has just churned in bank accounts. If you want to stimulate the economy, get money moving again: give the middle class a tax break, make businesses pay their 21.5% federal tax after closing loopholes, and get the economy moving.
mobiusm1
tax cuts for billionaires are what cause inflation. Elonia personally contributed to inflation. A lot. If you do the math his tax dodging is responsible for something like 4% of all U.S. inflation over the last 8 years.
mobiusm1
More if you count govt spending on spacex
Birdnose
Would be super cool if these idiots could learn how to read a basic graph.
DumpsterSauce
Umm hate to be the ackshually guy, but the graph goes to 2022. And while you're paying closer attention, it immediately starts dropping after trump
ImHereToExplainTheJoke
Side note: excessive regulation can cause prices to increase. Deregulation will NEVER bring prices down. It will bring business costs down, but do you really think that the businesses will pass those savings forward? The answer is not on your goddamn life
AGRIADR2
Regulations are written in BLOOD, just not the blood of the Wealthy.
torokunai
https://fred.stlouisfed.org/series/CP Says you’re right…
madjo
No, the inflation were seeing everywhere right now is nothing but corporate greed.
torokunai
Yup google “cp Fred” I promise it’ll not go to a bad place lol
Frenchgeek
And if you don't blame the government for it, he'll have to stop.
pleaseconsiderthatImightbejoking
Corporations were greedy before 2022
madjo
Under true inflation you wouldn’t also have record profits for corporations, their income would be down as well…
pleaseconsiderthatImightbejoking
No. Because prices aren't set to cover costs and a reasonable profit on top. They're set as high as the market will bear. That is, at the point that any further increase will lead to lower profits from reduced sales.
So the question is, what happened prior to 2022 that caused the market to accept higher prices?
AsheLake
Corporations have to actively test what the market will bear, and since they're not quite a monopoly or an organized cartel, individual businesses can't hike their prices on their own without damaging their brand. Sometimes there's just a spontaneous consensus that 'now is the time to really gouge.' It may be prompted by real events, but that doesn't mean those events "caused the market to accept higher prices." People simply have to buy necessities, and their resources weren't yet fully tapped.
OhIfIMust
They're becoming increasingly emboldened, and testing more to see just how much they can get away with.
witless1
Imagine being the richest man in the world despite not being able to read a graph. It must be nice being born rich.
MarcUK
People born into wealth tend to buy their educational qualifications. They're dumber than average.
TBoner101
"What is an Ivy League university?"
"Correct!"
"Billionaires for $500."
INeedMoreGifMeMoreJustOneMore
Even if he can read the graph, he knows his followers can't, but will believe what he says regardless.
Cinammontoastcrunch
He recently misunderstood the satire of starship troopers
n0gal
The First Lady Incumbent knows how to read this, he knows the majority of his followers won't even care to look at it critically.
shinagami091
I think he knows what he’s doing, he just knows his Musky Bros will gargle his balls and believe anything he says
whothefeckknows
He knows it's bullshit, he's just trying to manipulate the uninformed. Republicans have been outspending Democrat administrations for 40 years by a landslide. It's not even close. Democrats are the party of fiscal responsibility, not Republicans. Believe it or not, it's Republicans' strategy to keep making Democrats the bad guys. Republican admins spend and then the Democrat admins have to cut programs/benefits and raise taxes (generally) and then lose elections.
SteelKnight
As much as he is one of the literal dumbest men alive he is at least canny enough to k ow how to massage statistics to capture the approval of people almost as dumb as him
Ikusame
He knows how to read a graph he just knows his followers dont
Curii
Yeah imagine. Stuff I'd do: Museums get a freebies. There's a few small local museums that could do with some support. Well its time for a museum street! No Income tax for a year for anyone below £20k income. things I could do...
LitterBoxKing
And sleaze his way into a position to partially govern an entire nation.
bippityboppitybuttsex
You do realize that this advisory board thing he and Vivek are on has no power, whatsoever, it can issue reports, I guess, but only Congress can change funding.
plantpr0n
Yeah, that huge spike there at the end. Hmmm, was that a bunch of tax cuts for the wealthy?? Maaaaybe??
ballsoutflyer
And now we can look forward to it going to pluto.
DoingItWrongSince1980
Actually, depressingly, none of that bump includes the tax cut. This is purely expense. Cuts to revenue won't show up here.
That's just the covid payments, PPP payments, farmer bailouts from the tariffs, etc.
Now, pair all of those additional expenses on top of the corporate tax cuts that slashed revenue while expenses increased and you'll understand what the deficit bump is much bigger than the expense bump pictured above.
kailsar
It's covid, tax cuts wouldn't increase government spending.
LaffertyDanie1
No it's just covid spending
mrthewhitee
No it's covid spending, among other things. Tax cuts aren't "spending" it's a drop in revenue, so it would not be shown on this graph.
hushpuppyextraordinaire
Covid , remember when they sent us all checks?
evilspock
Mostly covid. Sorry. As much as I enjoy ragging on Donny, there was going to be a significant spike there no matter who was in charge. Hells, that might even be lower than it could have been, because Donny's "solution" was to downplay the problem and pay in human lives...
plantpr0n
My bad, morning fog. Yes, that'd be Covid/PPP stuffs.
We made sure to responsibly manage and distribute the PPP funds, though. Right?
Right!?
depressedscientist
PPP loan abuse and forgiveness
Vallete
More likely all the rich people taking the 'Small business' loans and never paying them back
TheZommie
or senators/congress members starting a new business, taking the small business loans, then dissolving the business and never paying them back
Vallete
congrationyoudoneit
https://www.forbes.com/sites/billybambrough/2020/03/28/donald-trump-and-the-fed-are-destroying-the-us-dollar/?sh=301a22d66ebc
bippityboppitybuttsex
Cutting gov't spending can cause a Depression, see the 1991-92 recession when the US slashed defense spending by 1/3 caused a recession (and the same in the mid-1970s, post Vietnam)...
The reality is any major shift of budget is going to cause a cascading effect in the economy...
The way to manage it is to shift spending, make sure it is compensated when cuts occur, maintaining liquidity and not cutting off companies without warning.
torokunai
Govt spending is pass thru, it goes right back into the private economy.
bippityboppitybuttsex
For example, after WW2, companies quickly shifted to satisfy pent-up consumer demand which offset the loss of gov't contracts... car companies started cranking out 1941 car models by the summer of 1945... and a lot of troopies came home flush with unspent cash... which filled the gap.
NotSomoneElse68
I've often thought about that in my fantasy budgeting plan because I really think that military spending needs to drop. But there's a lot of economy going on within that budget. I figured we could turn the military towards public works and infrastructure. It would also cost less to buy off the contacts from DOD employees from, say, weapons manufactures than to continue the contact for weapons we don't need. Basically if would cost less to pay all the employees to do nothing for 20 years than ¹
NotSomoneElse68
to continue to buy weapons we don't need. We could retrain them for other jobs without a loss of income. (Of course the billionaires would lose out on money, but fuck them.)
bippityboppitybuttsex
People complain about the consolidation of the defense industry, it had to happen when the Cold War ended, most of those companies could not stay in business afterwards and they got gobbled up others.
The reality is that our economy is a fragile beast and, while it is slow to change direction, it does work... massive disruption will break it.
My recommendation is to divert those industries to peaceful efforts, i.e. move Raytheon (aka RTX) to civilian space applications...
NotSomoneElse68
Similar to my idea of public works and infrastructure.
kailsar
The graph is also misleading because the US economy has grown hugely since the 1960s. Government spending as a percentage of GDP has not really changed much - graph below is for Federal spending.
QuintinParry
Dear Lord I wish people could understand normalizing data sets.
dank69
The best part of that graph is it took W 8 years to buttfuck us and only took Trump 4 years to buttfuck us. Extrapolating forward it should only take 0-2 years to buttfuck us again depending on if the acceleration is linear or not.
justherefortheconfession
Hugely? Do you mean "bigly"?
Nalianna
yuge!
FTUG
Amazing how it goes down when Trump wasn't in office, I wonder why that could be
pleaseconsiderthatImightbejoking
Covid spending expiring
svon1
"Trump is the best President i ever helped getting Elected""--V.Putin
hyperchondriac
I don't think Musk believes his own bullshit, he just likes lying to his idiot followers so they'll continue to vote away their rights.
420supercoolusername69
Don’t you know FRED is a liberal ploy to get people to believe that data is real?!?!?
jbrightmans
I think inflation was hugely impacted by the relief checks. When you give out almost $1T in free money, it devalues the existing money supply. I'm not saying it shouldn't have been done. That's just how it works. This was done during Trump's administration, yes. But I think any president would have done something similar. Inflation was going to happen one way or another. No one could have predicted COVID at that scale and everyone was trying to roll with the punches as it was happening.
TBoner101
username doesn't check out
CPTBRUMBL3Z
Or maybe inflation was caused by PPP loans that never required being paid back? Or multi billion dollar profit companies started posted 30, 50, 80 year record profit margins after spiking prices of goods and services sky high, pretended it was the "supply chain" and then never really lowered prices back down after the supply chain was more or less 100% restored? Nope, it was the "free money" to keep people from starving and going homeless, had to be
wandermanspacebot
Why would PPP loans cause inflation?
CPTBRUMBL3Z
While far less impactful than straight up corporate greed, the guy tried arguing that the covid relief checks are what caused inflation, so by his logic the PPP loans are just as bad if not worse since many businesses and landlords--even members of congress--took them out and basically pocketed tens even hundreds of thousands of dollars in cash when many they didn't need the loans, didn't use them to sure up their employees/tenants, and don't have to pay them back.
wandermanspacebot
Ah ok. I was like "why is this person making the same argument they're arguing against?"
KillingTlme
I prefer this chart as a percentage and not as a dollar amount. Thank you. Inflation happens, so no matter what $6,771 at 2.5% over 50 years would be $23,272
UmAcshually
With all due respect, that is also an extremely misleading graph. "Government" spending includes state and city governments as well, not just the federal one your graph is showing. Public spending as a percentantage of GDP has nearly doubled since 1960s. From 25-28% to 45%. As a nordic leftist I don't necessarily even think that's a bad thing in itself. But factually speaking, govt spending has risen massively.
BladeTurMoiL
Best part is, it’s probably all embezzled or otherwise wasted tax dollars that have done nothing to improve the country! Weeeee
NotACanadian
What was going on in 1942-46 to cause such a huge spike?
Seanspeed
We had to build a lot of boats.
alsoAzrael
"to 45%" if you want to insist on accuracy, maybe don't cherry pick an obvious outlier and go with the actual statistical trend, which is clearly around 34% or so.
UmAcshually
It is an outlier, but less than you'd think. Before 2008 it didn't hit 40%s except for WW2. Since then we've hit it on 2 separate occasions and on 3 separate years. At some point you shouldn't fully remove it from the data either. But you're right, it's not the most representative value & I shouldn't have quoted it. Per IMF 2022 was 36.26%, 2023 was 36.6%. The forecasts I can find past that (by Trading Economics) suggest 37.5% for this year and 38.5% for the next. So it's is high 30%s and rising
alsoAzrael
Fair. Interesting thought: I wonder what "govt. spending as percent of GDP" would look like compared to inflation. My guess is that would make it clear the two aren't really linked.
UmAcshually
https://tradingeconomics.com/united-states/inflation-cpi & int he "compare" add "United states government spending to GDP". It's a bit mixed. You could reasonably look at this and deduct that spending spikes are often followed by inflation spikes. On the other, I live in a nordic country with higher public-spending-to-gdp than USA and we don't have worse inflation than USA. Also, public spending has risen from 20%s to high 30%s without a constantly high inflation