Spending breached five percent of GDP in 1995, six percent in 2007, and seven percent of GDP in 2009. Government health spending breached two percent of GDP in 1970, three percent of GDP in 1980, and four percent of GDP in 1991. Ever since, government health care expenditures have trended steadily higher. Then, in 1965, Congress passed the Great Society legislation at the behest of President Johnson, featuring Medicare, a health subsidy program for older Americans, and Medicaid, a health care provision for the poor. It was about 0.25 percent of GDP in the early decades, 0.5 percent in the 1920s, and peaked at about one percent of GDP in the depression year of 1932. As the chart shows, government health care did not exceed one percent of GDP until the 1960s. The platform of the Progressive Party in 1912 called merely for a reorganization of public health services into a single national health service. Including 0.3 percent GDP in education grants to state and local governments.Īt the beginning of the 20th century, government spent little on health care. State governments spent about 1.5 percent GDP, and the federal government spent about 0.7 percent GDP, (Note: the blue sector in the chart is intergovernmental transfer from the federal government to state and local governments, i.e., grants.)Īt the end of the 2010s, local governments spent about 3.7 percent GDP on education, The federal government has periodically increased its role, starting with the GI Bill and continuing with periodic enactment and expansion of educational grant programs to local K-12 schools and state colleges. However, since World War II state governments have steadily increased spending, Throughout the history of government education, most education has been provided by local governments. Is declining as a percent of GDP in the 2010s. Allowing for a dip during World War II and a bulge in the 1970s, government spending for education has steadily increased year on year, reaching 6 percent of GDP in 2008. In the early decades, from 1910 to 1940, spending increased to accommodate the build out of high schools.Īfter World War II, spending increased due to an expansion in higher education and the increases in teacher pay.
YEAR OVER YEAR DIFFERENCE PERCENTAGE OF GRANDTOTAL SPOTFIRE FULL
But the common schools movement initiated in Massachusetts in the 1840s began a process of centralization and bureaucratization that came into its full flowering in the 20th century.Įducation spending began the century at one percent of GDP, primarily at the local level. Years brought defense spending back up to 4.8 percent GDP in 2020.Ĭhart 2.25: 20th Century Education SpendingĮducation in North America began as local and individual. In the Obama administration defense spending eased back to 4.5 percent of GDP by 2015.
Against this the defense buildup during the Reagan era, from 5.5 percent of GDP in 1979 to 6.9 percent of GDP in 1986 was modest, and the Bush buildup from 3.5 percent in 1999 to 5.7 percent in 2010 to fight the first battles against Islamist extremism equally restrained. From a low of 7.2 percent of GDP in 1948 it doubled to 15 percent at the height of the Korean War in 1953, and was maintained at about 10 percent during the peak of the Cold War through the height of the Vietnam War. But after the war it never returned to previous levels. Then in World War II the United States achieved an unprecedented mobilization of resources, and defense spending rose to 41 percent of GDP in 1945.
War the armed forces were rapidly demobilized and defense spending returned to about 1.25 percent of GDP.
Yet this tiny establishment was expanded into an expeditionary army in World War I that consumed over 20 percent of GDP and turned the tide of the war in France. The defense establishment that sent the White Fleet around the world before World War I was tiny, compared to the defense establishment of mid century. Chart 2.23: 20th Century Defense Spending
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