United States National DebtSpurred by Dubya's recent economic stimulus plan (dubbed "Reaganomics II" by some of the media), I started playing with historic financial data for the United States. So I dug up national debt, inflation, census and population estimates, and gross domestic product component data and started graphing to see if I could find anything interesting about how we've interacted with debt in the past.
The obvious first thing to try was just a plain graph of the national debt over the years:
This shows the huge jumps for World War I, World War II, and Reaganomics (Reagan and Bush the senior's "Voodoo Economics"), but kind of loses detail in the prior century. Lets try that again with a log scale:
This makes the big jumps way less obvious, but shows a lot more detail in the changes. Except for a brief period between 1830 and 1840, the debt hasn't really done much of anything but go up.
I guess I'm trying to grasp how our various policies would've personally impacted my life if I had existed in various points in history. So rather than looking at the raw numbers, I started using using per-capita numbers, to better show the debt's impact on each person:
Or with the more detailed population estimates for 1900-2004:
Graphing historical data for a whole country somehow feels empowering. You know that you could track down stories to go with each little bend in the graph.
Oh, notice that as of the year 2004, you personally owe somebody else over $25,000 on behalf of our government. Woohoo.
Then I found a breakdown of the Gross Domestic Product for every year since 1929. Adding that to the graph, I'm starting to get a sense that either I'm misunderstanding the idea of GDP or the Consumer Price Index (what "inflation" is based on), or the average American was a lot poorer than I was imagining back in the day. Maybe this is just showing less specialization. People were more self-sufficient, not relying on society and the exchange of money for common goods and services?
But looking at this, the national debt hasn't grown as wildly as it first appeared. Except for WWII, its managed to grow roughly linearly with the GDP.
I wanted to see what portion of the GDP things like the national debt, defense spending, etc were. Compared directly to the GDP, this tells an interesting story about WWII; personal consumption and private investment took a back seat to defense spending, and the nation racked up huge debt to pay for it. For a few years, the amount the country owed was more than all of the money exchanged within it could pay for in a year; this seems impressive somehow.