OK kids here’s one for you (since the BEA keeps sending me to voicemail): If you look at the FRED data for current (i.e. nominal) expenditures, unless I’m doing the math wrong it shows that for a few years (particularly in the 1940s) total government consumption and gross investment is higher than total government expenditures. For example, in 1942 nominal government C&I is $62.7 billion, while nominal federal spending is $31 billion and nominal state & local spending is $8.5 billion. I am pretty sure I’m doing apples to apples (i.e. nominal and government at all levels) in the various categories.
So, does this make theoretical sense or is something wrong with the numbers?
The motivation for this was that I was trying to back out government transfer payments. I thought for a given year I could look at how much the government spent on consumption and investment, and subtract this amount from total government spending. The remainder I thought would be transfer payments (and maybe debt payments? what else?). So I was surprised that this approach gave me negative numbers for some years.