Saturday, April 17, 2010

Government Budget Deficits at War-Time Levels

During World War II, U.S. government spending as a percentage of GDP was about 45%. It is over 20% now, with the Obama administration on a spending spree beyond that. We can become another Greece-like world mendicant.

What does this mean for small and large business? Particularly those who cannot compete with the big government competition, in health insurance and politically-favored industries?

Remember: Government spending displaces funds available for the private sector. When that occurs, firms seeking funds are less likely to get them. Yet, they are the entities which mainly create worthwhile jobs.

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