Evidence suggests that the Fed has not been effective in accomplishing its stabilization goals, and some argue that there is little reason to believe it could ever do so with discretionary monetary policy.
Graph: Reserve Balances with Federal Reserve Banks
they found that public-sector employment grew by almost 3.5 million jobs to a national average of 19.2 percent of the workforce. In other words, nearly one-fifth of all workers in the United States are employed either directly or indirectly by government.
Government Spending in the US
There are three levels of governments in the US: federal, state, and local. The following table shows current spending for federal, state and local governments, and also total overall spending. Federal spending includes grants and transfers to state and local governments. State and local government spending includes “direct” spending on programs only.
Expense (% of GDP)Expense is cash payments for operating activities of the government in providing goods and services. It includes compensation of employees (such as wages and salaries), interest and subsidies, grants, social benefits, and other expenses such as rent and dividends.
“The governor and the public employees’ unions had a great ground game, and of course it was another big Obama year,” said Jon Coupal, president of the Howard Jarvis Taxpayers Association, which opposed Proposition 30.
He said he worried that Proposition 30 will accelerate the exodus of small-business owners and taxpayers. Those earning more than $250,000 annually will see their marginal income-tax rate leap from 10.3 to 13.3 percent. The measure also raises for four years the sales tax from 7.25 to 7.50 cents on the dollar.
Under Proposition 30, California will have the highest top marginal state income-tax rate in the nation. The state already had the highest sales tax in the nation.
“I think it’s going to be a Third World economy on the order of Greece,” said Mr. Coupal. “The impact on the overall economy is going to be a real body blow, and it won’t manifest itself for a couple of years. Then you’re going to have people saying, ‘What happened?’”
Now, with the implementation of California’s massive Global Warming law set to take effect, not to mention the passage of huge sales and income increases, California will be the highest taxed and regulated state in the world. It already ranks last in the U.S. as a place to start a business because of taxes and regulations, and is witness to many employers leaving the state.