America passes a milestone!

We now have more poeple employed in government than manufacturing and construction.

Employment in government and manufacturing

—– Graph from Contrary Investor, 9 December 2008 — subscription only.

It’s a milestone.  But to what end does this road lead us?

See these reports for For other perspectives

(1)  Factors Underlying the Decline in Manufacturing Employment Since 2000“, Congressional Budget Office, 23 December 2008 (8 pages)

(2)  See Can you see the signs of spring in the coming of winter? A note about the recession (10 September 2008).   Esp note graph #2, “US exports of goods and services as a % of GDP.”  It is often said that “the US no longer makes things.”   Not so, as exports have grown as a fraction of the US economy for 30 years.   That is important and good news.  America must earn its way in the world, and by some means other than as a largely unwanted global policeman.


Please share your comments by posting below.  Per the FM site’s Comment Policy, please make them brief (250 words max), civil, and relevant to this post.  Or email me at fabmaximus at hotmail dot com (note the spam-protected spelling).

For information about this site see the About page, at the top of the right-side menu bar.

For more information from the FM site

To read other articles about these things, see the FM reference page on the right side menu bar.  Of esp interest these days:

Implications for the future, about structural changes to America from this crisis

  1. Treasury Secretary Paulson leads us across the Rubicon, 9 September 2008
  2. Say good-bye to the old America. Welcome to our new socialist paradise!, 17 September 2008
  3. Another voice warning about the nationalization of AIG, 18 September 2008
  4. Another step away from our Constitutional system, with applause, 19 September 2008
  5. America appoints a Magister Populi to deal with the financial crisis, 21 September 2008
  6. Legal experts discuss if the Paulson Plan is legal, 21 September 2008
  7. German Finance Minister Peer Steinbrück explains how the world is changing, 30 September 2008
  8. America has changed. Why do so many foreigners see this, but so few Americans?, 1 October 2008
  9. America is changing. Read some chillling words from a liberal economist, 2 October 2008

126 thoughts on “America passes a milestone!”

  1. Pingback: DYSPEPSIA GENERATION » Blog Archive » We now have more poeple employed in government than manufacturing and construction.

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  3. It would also be interesting to compare such a graph for aid-needing African countries — I’m sure that a major reason ‘aid’ fails is that so much of it goes into trying to get good government, rather than producing better goods and services.

    I have faith we will work through this, although I do not see the way.
    It’s likely that all the gov’t employed folks will, despite first-hand knowledge of how bad gov’t performs, pretty consistently support higher taxes and bigger gov’t.

    This leads to a path already followed by Rhodesia … now Zimbabwe.

    I don’t think the UK will go that far, but it’s already closer than the USA, who seems to be following.

    To those anti-war folk here, please remember that gov’t IS FORCE. The purpose of gov’t is to use force, to solve problems like a justice system or national defense, which can’t really be solved without force. The post office and all education can certainly be provided without gov’t; arguably at better levels of service for less cost. A Thatcher like round of Privatization would help, but it’s not likely until this economic crisis turns around.

    The sheep-lemming voters who want to benefit from their favorite gov’t program, spending Other People’s Money, are those with exactly the wrong spirit.

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  7. Actually the milestone was passed years ago, most of the employees in manufacturing & construction where I live are almost exclusively aliens and immigrants so the number of Americans employed is far smaller than shown on the graph.

  8. People that are Obamamized cannot see across the street. Its all the fault of Bush. Bush did this, Bush did that. What Bush didn’t have was a way of speaking without screwing up. People in this country want a president that can speak well, not fight well. If Obama shot Paris Hiltons little dog, the Obama fanatics would say he was saving everybody from a beast. Like that guy said in Red October. A politician is a liar and a cheat, when they’re not kissing babies, they’re stealing their lollipops.

  9. “But to what end does this road lead us?”

    A twisted form of Communism basically, yet without the caps on income of the upper classes and none of the amenities associated with a ‘pure’ Communistic system such as food assistance, universal healthcare, free or very low cost housing, good transportation networks, etc.

    Working at Wal-Mart might as well be a government job now too considering so many of its workers have to draw welfare because the company pays so little in hourly wages.

  10. electrophoresis

    Eman remarked:
    “But to what end does this road lead us?”

    A twisted form of Communism basically, yet without the caps on income of the upper classes and none of the amenities associated with a ‘pure’ Communistic system such as food assistance, universal healthcare, free or very low cost housing, good transportation networks, etc.

    Not if you retired from the military with a good rank, say above CPO in the Navy or above Master Sargent in the Army. Then you get guaranteed healthcare, and since you can double-dip on your pension you effective get a housing subsidy in the form of extra income to pay down your mortgage. Likewise, if you work for the USPS or some other gov’t agency and retire, you get quite a generous pension with good benefits by the standards of today’s private economy, in which pensions have essentially gone away.

    America lacks good public transpo but non-Communist European nations have that as well as former Communist European nations, so the quality of public transit seems not to be a function of communism so much as social priorities and, to some extent, geographic density.

    Arms Merchant blames the failure to cut government spending under Reagan on the Democratic congress. However, since the major growth in gov’t spending under Reagan involved military ramp-up for worthless boondoggles like Star Wars, the ABM system, etc., all Buck Rogers death ray superweapon projects which don’t work and never had any prospect of working, I would like to know from Arms Merchant whether as a presumptive conservative he is blaming the Democratic congress from 1981 to 1989 for not cutting the size of the U.S. military?

    I would find that fascinating. I don’t believe I have ever heard a conservative blame the Democratic congress for failing to slash military spending. The implied corollary, presumably, is that a truly conservative Republican congress would deeply cut military spending if they were to gain power. According to this line of reasoning, neither the former drunken lout in the Oval Office nor the Republican congress from Gingrich’s 1994 Republican Revolution to 2009 were “true” conservatives.

    It’s absolutely fascinating to hear that Gingrich and his Republican cronies along with the drunken lout weren’t real conservatives, because countless conservative commentators lauded and exulted in the simon-pure conservatism of these characters back before the consequences of their policies began to manifest themselves.

    For example, this 4 November 2004 panegyric by Peggy Noonan to her hero and living god George W. Bush urging conservatives to “savor” the triumph of conservatism in the November 2004 presidential election.

    Savor: George W. Bush is the first president to win more than 50% of the popular vote since 1988. (Bill Clinton failed to twice; Mr. Bush failed to last time and fell short of a plurality by half a million.) The president received more than 59 million votes, breaking Ronald Reagan’s old record of 54.5 million. Mr. Bush increased his personal percentages in almost every state in the union. He carried the Catholic vote and won 42% of the Hispanic vote and 24% of the Jewish vote (up from 19% in 2000.)

    Peggy Noonan seems to compare the drunken lout quite favorably with her conservative icon Ronald Reagan. At what point, exactly, did the drunken lout and his Republican congress stop being “conservative”? Was it perhaps when the disastrous consequences of their crazy policies began to become obvious even to the dullest bystander…>

    Arms Merchant goes on to wonder:
    When I look at how many are riding the wagon vs. pulling it, I wonder how much more “stimulus” our economy can take.

    By contast with the faux claims that the drunken lout and his Abaramoff co-conspirators were not “real” conservatives, this plaint touches on a substantive issue. But I’m not hearing it from any of the frothing-at-the-mouth Obama-haters here.

    Namely, America is headed for a gigantic fiscal collision that will reduce the U.S. economy to dust and atoms when baby boomers start retiring en masse and slurping up medicare to the tune of some 97 trillion dollars of future entitlement obligations. Don’t believe me — listen to the head of the GAO: GAO Chief Warns That Economic Disaster Looms.

    Mind you, that warning came before the current economic collapse. The present meltdown of the world economy represnts a minor speed bump for the United States, only a few tens of trillions of dollars, compared to the truly Brobdingagian near-100-trillion tidal wave of red ink racing toward us like a ten-mile-tall tsunami.

    Moreover, because the essential problem in this 97-trillion-dollar shortfall is demographic, it’s not obvious how to fix it. The basic problem is that we are coming into a regime by around 2030 in which we’ve shifted from 3 workers to support every retiree, to one worker to support every 2 retirees. That’s unsustainable, pure and simple…yet no one, conservative or liberal, is talking about this looming fiscal catastrophe.

    That’s the big threat the Obama-haters should be talking and worrying about, not this trivial little stimulus package with perhaps a measly 10 trillion of spending in it all told. The really big fiscal collapse is yet to come, and it will arrive with a bill of nearly 100 trillion dollars.

    If you folks have any idea where to get that kind of money other than by zeroing out the U.S. military, please let us know. I’m all ears.

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  12. “I have faith we will work through this, although I do not see the way.”

    True, but I would would make one further point.

    Those previous changes required exchanging one physical activity for another. You had to move, etc., but anyone could do it.

    Now, it’s different, or seems to be. The new work involes much more intellectual input. We don’t need workers, we need thinkers. Since almost half of the population is below average intelligence, there’s a problem.

    It’s a qualitative difference. It requires more than social evolution, it requires actual biological change to the organism, ie, humans. Most people won’t make the cut.

  13. Your report stated only Manufacturing and Construction. Whatever, I think the report is also meant to draw opinions. Like, is it normal? Is it good? Is it bad? But I think the report is interesting. It made me think things I’ve never given thoughts before.

    Mine are hypothetical: Let’s say from 20% Government employed [non-production] rose to 30%. Considering that it is the 70% who shoulder the bill, then this must be bad. The ideal must be a smaller but efficient bureaucracy. And, if the 10% does not add to efficiency in public services then the public is purely subsidizing this unnecessary additional force.

    But this 10% belongs to the unemployed if they are not there in government. What would be the overall situation in that case? Like, as we know, people are consumers. But this is in the U.S.

    I live in the third world. What is applicable in the first world does not always apply in the third world vice versa as conditions greatly differ. Like

    Third world has high unemployment and poverty rate. There is high degree of political and social unrests. Governments employ high in relation to their very limited resources. Police and the military eats up the great part of budgets. Are they normal? Are they necessary? Are they productive? Are they progressive? A war employs[U.S. have 100 thousands in Iraq], but…I think the world is trapped to its destiny(?)

  14. Government cannot even decide on who VP should be. Biden and Hillary should’ve had to wrestle for the job. Billy is thrilled the old bag will be in Iraq half the time. He’s not done groping the hired help.
    It seems many of you are political science majors. Trying to figure out the mess of politics is a waste of our time. The only power we have is what officials we elect, nothing more. Palin 2012!

  15. Re, #95. Whoa, pardner (electrophoresis). You might want to take a breath and figure out who your friends and enemies really are.

    “…since the major growth in gov’t spending under Reagan involved military ramp-up for worthless boondoggles…”

    Actually it was a mixed bag, like most attempts by the federal government. Gulf War I showed a lot of the spending wasn’t for boondoggles. And it wasn’t full speed ahead, either. Bush One’s SECDEF Cheney canceled the A-12 and the Sgt York. The B-1 was kind of a turkey but eventually turned into a pretty good system, demonstrating the engineering maxim that enough time and money fixes anything. Other systems like the F-117, the Bradley AFV, and the A-10 showed we made some pretty good investments, at least for the purposes for which presumably they would be used (e.g., the Fulda Gap).

    “I would like to know from Arms Merchant whether as a presumptive conservative…”

    Actually, I would call myself a conservative libertarian. See Robert Ringer’s site for a good overview of the philosophy (here). But the author himself cautions, “Regardless, in the final analysis, the initial premise of any philosophy can never rightfully be classified as anything other than an opinion.”( So I would hope that I am a thinker and not an ideologue.

    “…he is blaming the Democratic congress from 1981 to 1989 for not cutting the size of the U.S. military?”

    False premise. The Democratic Congress DID cut the force, by about 40%, in fact. Their failure was in not commensurately cutting headquarters and general/flag officer billets, and in not bringing home a larger percentage of our forces from foreign bases (although keeping some troops abroad was a hedge). After fall of the USSR the Bush Ones were already talking about the peace dividend. There was broad consensus on doing this.

    “If you folks have any idea where to get that kind of money other than by zeroing out the U.S. military, please let us know. I’m all ears.”

    The HHS budget far outstrips the DoD budget, even with the wars and associated supplementals (here). Defense spending is about 4% of GDP. Government is over a quarter of GDP (by some accounts, over 35%)(see here). You tell me where is the burden on producing people.

    Certainly you could safely cut the parts of the DoD budget that are “tail” even before going to work on the “tooth.” Moreover, a force on strategic defense would probably look a lot different from our current force. There are a lot of good ideas (many on, but “zeroing out” defense is not one of them.

    Labels are useful only up to a point. Not sure where you were going with the “real conservative” rant. We seem to agree that current spending is unsustainable. The red line marches relentlessly up. Your freedom is the inverse.
    Fabius Maximus replies: Most of this is too bizarre to discuss (e.g., defending the Fulda Gap with the 64 F-117’s we built at $112 million per). Broadly defined, we spend more on national security than almost everyone else combined, which is insane.

    For the few of you who take this subject seriously I recomend reading the reports at the Center for Defense Information. For other who would like the brief all you need to know about US defense spending, I recommend reading “A True Son of Tzu, Guderian Was the Mother“, Fred Reed, 23 January 2007.

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  19. We spend more on defense because we are the baddest motherf’ers in the world. Iran, N. Korean soldiers all march around their king all day like morons while we’re perfecting a stealth fighter that can take out ten targets at once without being detected. Sure money gets wasted on projects that will never make it to the military for use, but thats the beauty of this country. We need to take out all possible nuclear threats this world has but ours. We should explode a nuke in the middle of the Saudi desert. Make sure those pricks know we want that oil to stay below 40 a barrel. As for that punk in Venezuela, snipe him.

  20. electrophoresis

    Jimhenly exults:
    We spend more on defense because we are the baddest motherf’ers in the world.”

    That’s why a bunch of 15-year-old kids armed with AK-47s have been able to defeat the U.S. army in Viet Nam, Iraq, Afghanistan, Lebanon and Somalia.

    I have little to add to Fabius Maximus’ comments other than to urge everyone here to read America’s Defense Meltdown. This white paper was produced not by far-left body-pierced peacenik hippies, but by an array of ex-military officers many of whom served for more than 20 years.

    Also take a look at GAO Blasts Pentagon Weapons Progams. The GAO report details not only outrageous cost overruns in dozens of weapons systems, it points out that virtually all of those weapons systems either don’t work, or were abandoned when they turned into boondoggles.

    The Pentagon’s accounting system is so chaotic that it doesn’t even know what happens to the money it gets: Worse Than Enron, Worse than Worldcom: The Pentagon

    Meanwhile, the Pentagon’s own report states that “The continual degradation of audit resources that is occurring at a time when the DoD budget is growing larger leaves the Department more vulnerable to fraud, waste, and, abuse and undermines the Department’s mission.”

    As a final note, the actual U.S. military budget, broadly defined to include the DHS and NSA and CIA, comes to 1.35 trillion dollars, not 600 billion or even 800 billion dollars. Moreover, since at least 1/3 of the official U.S. GDP turned out to be phony creative accounting gimmicks that went up in smoke with all those liar loans when the subprime meltdown occurred, the real U.S. GDP is actually closer to 10 trillion than 13 trillion. More than 7 trillion dollars of real estate “assets” have evaporated so far in the financial crisis, and since U.S. financial institutions count the interest on that 7 trillion dollars of phony assets as profit, that means that roughly 50% of that bogus profit vanished like a puff of smoke from the official U.S. GDP.

    10 trillion divided by 1.35 trillion isn’t 4% of GDP. That’s 8% of GDP, a near-Soviet level of expenditure. With a 3 trillion annual budget, 1.35 trillion is actually 45% of the U.S. budget.

    I look forward to a mob of crackpots denying that the actually U.S. military budget per annum is 1.35 trillion so that I can post a detailed breakdown and prove that you’re lying.

  21. electrophoresis, I am not for a moment denying the current sad state of affairs. I called you out on your revisionist history of the Reagan buildup. Note where the red line dips and flattens–his first term.

    Don’t lump Reagan in with the previous administration, who just promoted and facilitated in the biggest heist in history ( At least the defense industry builds something. The banks are sitting on the money to shore up their balance sheets. A change from mark-to-market valuation to three-year rolling average could do something similar (and wouldn’t have precipitated panic sales and failures last autumn). We can agree that Reagan, Bush 1, and Clinton did little to fix the Pentagon, and Bush 2 made a bad problem much, much worse.

    As for FM, I thought you were better than name-calling. I wrote nothing of the sort – rather that the buildup was part of Reagan’s strategy for the Cold War and many of the weapons produced proved effective in Gulf War I. Perhaps I must be more explicit – I’m trying to be brief but my style of expression seems to continually cause confusion for you. Perhaps you need a vacation.

  22. Re 105. We were not defeated in any of the locations you mentioned. In Vietnam, our airpower could’ve won that war easily. 50 million people in Iraq and Afghanistan are now free because of our Armed Forces. Somalia was a few of our heros against 4k murderers. A 15 year old with an AK-47 could terroize, and kill many at large high school.
    Why do hate our military? It has protected us from terrorists doing harm in the U.S. the last eight years. Nobody reads your breakdowns. Hunting season opened Jan. 20th 2009. With Obama as president, keep your eyes open.

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  25. @96

    I think any kind of work requires necessary intelligence to get done and done efficiently. And I believe, except for the born mentally handicapped, any man can become an Albert Einstein given the absolute exact conditions that Albert was brought up.

    But in reality, one child was more interested in playing with spiders and marbles, when another was more interested in reading books, so now we see everyone like we see them today.

    This is hypothetical, but even if every man is an Einstein, we would be seeing the same social structures that we see today: A company needs only one manager so only one person gets the position. And, the same goes for all other slots. So, we will have the IQ of an Einstein to cut the sugarcanes, the same to haul them to the mill, and the same to finally produce the sugar that is brought to every table.

    Let’s accept it that society is one huge corporation. There is head, body, hands and feet, or heads and tails – all them working collectively to serve the whole. Other than that would be a giant blob that thinks but does nothing and goes nowhere.

    My point is, maybe societies should be working for more social equities. When some have too much while others are starving or are deprived, then we have an issue. There is a problem.

  26. Devils advocate

    This is not necessarily a case of govt overspending; it is a case of The Banking Empire’s influence on the govt. Apparently, if those jobs did not exist America’s growth the past 40 years would had been tampered, to say the least.

    Grow, baby, grow!

    tempered too

  27. Whether its credit cards, home mortgages, an auto loan, etc. Millions of people in this country are in debt. Why are they in debt? Its simple, people like to spend what they don’t have, and banks have made that easy to do. Obama wants to spend a trillion to jump start the economy. Everyone of his cronies cannot wait for that money to flow in. Lets give some of this money to the American people, so everyone can pay off their debts and start fresh. All home mortgages will be modified, all credit cards, and autos will be paid off. Good idea or bad?

  28. Military numbers


    I don’t disagree with the spending numbers you’ve provided but these charts show jobs not money. You say the increase in government jobs is mostly military (#54), yet we only currently employ about 3 million active and reserve personnel. Does that mean that 10 years ago we didn’t have any military at all (according to the chart)?

    The fact is that there are too many people working for us, government is an expense to the American citizens and they don’t produce anything. All they do is provide services, unless you think printing more money is being productive.

  29. Wikipedia on US military personnel and expenditures.

    As an absolute number, the number of US military personnel was cut in half over the last 40 years.
    Fabius Maximus replies: True, but we spend almost as much on national security as the rest of the world combined — and several times more than all our enemies (real and imagined) combined.

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  31. Please figure up the ratio of ALL LEGAL civilian workers compared to government workers and estimate the date each civilian worker will have to support one government worker.
    Fabius Maximus replies: You must be mad. You pay nothing for this site, and should be grateful for the dribs and drabs that are posted until I resume my true advocation of building ships-in-bottles.

  32. This is a very slow blog. There are only two sides to this government, defense, or economic issue. Obamamania or not. Obama sees it this way. His bill is a win win for him. When half of this money is spent, the economy will have fixed itself. Obama takes a bow, and he’s re-elected. All of his crones will have sucked away enough retirement money to float around Bermuda the rest of their lives. Taxpayer money, your money.
    Fabius Maximus replies: Always nice to see that Prophets still walk among us, either a super-genius or blessed by God with second sight. The rest of us travel through the fog, the future uncertain, unable to see beyond choices we do not yet understand.

  33. Fabius Maximus,
    A blog had your link to this information. I have never been to this sight before. It is great to know this information. I thought this was one of the sights that keeps track of things like that. I am sorry I made you mad. I just thought it would be interesting for an organization to figure out when one civilian will be support one government worker. NO REPLY NECESSARY.

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