I don't think percent of GDP is a meaningful metric. Dollar for [inflated] dollar we're spending a lot more on defense, and it eats up near to the majority of our discretionary spending. The distinction between mandatory and discretionary isn't weird - mandatory is payments that the government is legally required to make, discretionary is what they have the choice of spending. And so now a days near to the majority of what the government has the choice of spending, is spent on war.
Sovereign wealth funds of the sort you're alluding to have a problem - governments can't ever control their spending, so the funds always end up getting plundered. The Alaska Permanent Fund is a great example. It was created after massive oil reserves were discovered in Alaska resulting in a huge windfall of money to the government. The government proceeded to completely waste all of that money with nothing to show for it, which made people less than happy. So the idea of the APF was to create a fund that could provide social dividends in both the present and even after the oil eventually runs out.
But as the government started, again, blowing money, they started dipping into the fund and eventually changed the law to normalize it and it's gradually turning into a joke. This years dividend was $1000, compared to $3300 (inflation adjusted) at its peak in 1999. The problem with 'well just make it where you can't do that' is that the same people that make that law, are the exact same that can unmake that law and give themselves lots of other people's money, which they will do, sooner or later.
> I don't think percent of GDP is a meaningful metric.
Why not? I think it's close to the only useful metric across time.
> The distinction between mandatory and discretionary isn't weird - mandatory is payments that the government is legally required to make, discretionary is what they have the choice of spending.
Laws aren't god given. They can be changed. The political processes are slightly different, but if the voters want it, they can get it.
> Sovereign wealth funds of the sort you're alluding to have a problem - [...]
I'm not alluding to any sovereign wealth funds. What makes you think so?
I suggested to get pension systems out of the hands of government, not into them.
A fully funded pension system that invests globally outside the government's balance sheet is essentially exactly what a sovereign wealth fund is. Even when it is managed privately (as the Alaska fund is) the government has regulatory control of the fund, which is where the looting is, probably unavoidably, introduced.
As for money vs GDP, our discussion on mandatory vs discretionary spending is already one reason why $$$ is far more informative. Dollars can, after inflation, be compared and paint a relatively clear picture. Percent of some other metric, which has often changed wildly over time, is instead more likely just to mislead.
So for instance we now spend hundreds of billions of dollars more on the war machine than we did during the Cold War when we were facing a very viable threat of nuclear annihilation. That's an extremely valuable metric that does mean a lot. Why are we spending so much on war?
The fantasy about it creating some sort of unstoppable war machine has clearly been clearly shattered. It's not even clear that would have been desirable if true. One thing this administration got completely right was renaming the Department of Defense to its old moniker of Depart of War, because that is what it really is.
This reality is completely muddled if you start trying to frame things as percent of some other metric, be that budget, GDP, or whatever else.
Sovereign wealth funds of the sort you're alluding to have a problem - governments can't ever control their spending, so the funds always end up getting plundered. The Alaska Permanent Fund is a great example. It was created after massive oil reserves were discovered in Alaska resulting in a huge windfall of money to the government. The government proceeded to completely waste all of that money with nothing to show for it, which made people less than happy. So the idea of the APF was to create a fund that could provide social dividends in both the present and even after the oil eventually runs out.
But as the government started, again, blowing money, they started dipping into the fund and eventually changed the law to normalize it and it's gradually turning into a joke. This years dividend was $1000, compared to $3300 (inflation adjusted) at its peak in 1999. The problem with 'well just make it where you can't do that' is that the same people that make that law, are the exact same that can unmake that law and give themselves lots of other people's money, which they will do, sooner or later.