While the Obama Administration struggles to contain the Gulf oil spill, the Administration has succeeded in capping the private sector. Today the U.S. Department of Commerce’s Bureau of Economic Analysis released new personal income data for the first quarter of 2010. Unfortunately, this brings more bad news for Americans. As shown in Chart 1, America’s private sector share of personal income for the first quarter of 2010 was at a new all-time low of 68.23 percent–just edging out the previous low of 68.59 percent set in the last quarter (fourth quarter 2009). Also shown are my two favorite states representing the opposite ends of the private sector spectrum.
Chart 2 shows the culprit behind this crowding-out of the private sector–the Orwellian American Recovery and Reinvestment Act. In the first quarter of 2010, the ARRA pumped $113.5 billion into America’s economy via personal current transfer receipts (such as Medicaid)—the highest of any quarter since the ARRA has been in existence. For a state-by-state list, see here (pdf). Adding insult to injury, the $113.5 million is more money than the total earnings of Americans employed in Farming ($63 billion), Forestry, Fishing, related activities, other ($28 billion), Mining ($102 billion), Utilities ($75 billion) and Arts, Entertainment and Recreation ($102 billion). Perhaps most surprisingly, its not much below military earnings of $190 billion.
What do we get for all this money? Near double-digit unemployment, unprecedented peace-time budget deficits, and the ever-present threat of enormous tax hikes.
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