And the liberal Center for American Progress complained that “fiscal austerity threatens the U.S. economy.”
On the surface, it might look that way.
In its GDP report, for example, the Bureau of Economic Analysis said government spending dropped 6.6% in Q4. And unless Congress acts, more than $1 trillion in automatic spending cuts will start to kick in as part of the so-called sequester.
But dig a little deeper, and there’s little to back up all this austerity talk.
According to monthly spending data from the Treasury Dept., total federal spending — which includes transfer payments and other federal outlays not counted by the BEA — increased by $98 billion in Q4 compared with Q3. And spending was up $31 billion when compared with Q4 2011.
For the entire year, spending in 2012 was virtually unchanged from 2011, and was up $86 billion over 2010, a year when the government was still spending stimulus money in earnest.
Plus, the “fiscal cliff” deal worked out between President Obama and the Republicans actually added almost $50 billion to planned spending in 2013, and a total of $332 billion over the next decade, according to the Congressional Budget Office.