The need for different public services rises and falls over time, as demographic and social conditions change. As this is being written, there is a great need for public Health and Hospital services. When the Baby Boomers were school age, and when their children, the Millennials were at the same age, the demand was greatest for Elementary and Secondary Education. The shift from rural America to the cities and then from the cities to the suburbs was associated with high spending on infrastructure. The different lifestyle preferences and diminished income and wealth of Millennials, and global warming, ought to induce another infrastructure wave. During World War II, military spending dominated government budgets.
The Baby Boomers drove another shift in public spending priorities, in addition to education. As perhaps the most criminal generation in U.S. history their young adult years, from the 1960s to the early 1990s, saw a massive violent crime wave that led to a huge increase in spending on Police Protection and Corrections. As they got older, a white collar crime wave followed. Subsequent generations have been less likely to commit street crimes as young adults, less likely to be teenage or single parents, less likely to become divorced, less likely to drop out of school. One might expect that spending on Police Protection and Corrections would have fallen sharply in the years since, per $1,000 of the personal income of those paying for it.
For many elected officials, public union leaders, and contractors, however, the purpose of government spending is to provide money for interest groups in exchange for political support, not to meet the needs of the people. So spending on a particular function doesn’t always decline with need, let alone due to productivity gains. It fact it usually doesn’t. That was the case for military spending after World War II, when President and former General Eisenhower warned of the military-industrial complex. That was the case for public schools in New York City, where spending didn’t increase as the Millennials entered school age in the 1990s, and didn’t decrease as they exited in the 2010s. How about spending on Police Protection and Correction?