Has the federal gov't ever reduced spending?

Factual Questions
1

Has the federal US government ever had an annual budget that was smaller than the previous year? Has the government ever managed to cut total spending? How long ago was that?

2

Yes, several times. Here is an excel file from the White House. http://www.whitehouse.gov/omb/budget/fy2008/sheets/hist01z1.xls

Notably right after WW1, as well as after WW2. Then again in 1955 and just barely again in 1965. Since then, no decreases YOY.

ETA, 1933, 1935, 1937 and 1938 as well.

3

There’s a rather nice graph on Wikipedia of Federal spending, 1934-2006. It looks like in unadjusted dollars, the answer is post-WWII. In constant dollars, there are dips but none that I’d call particularly significant.

4

It’s worth noting that a lot of the yearly increases were less than inflation. If you look at historic expenditures as percentages of GDP, you can see that while there are definite changes, overall it’s been at about 18-22 percent for the last five or six decades. Of course, GDP isn’t a completely foolproof method of adjusting for inflation, only a readily-accessible one, but the point remains that just looking at the dollar value paints a very different picture.

ETA: forgot to mention that GDP is adjusting for both inflation and expansion of the economy, not just inflation.

5

Winsling’s graph is in 2007 dollars, so it’s already adjusted for inflation. Adjusting for the size of the economy as well still makes sense, though, if for no other reason then that there are more people to spend money on now then in 1934.

6

Since the government gets most of its revenue from taxes, its important to look at government spending in relation to the entire economy. There are a couple of charts comparing government spending to the US GDP here:

http://carriedaway.blogs.com/carried_away/2003/10/us_government_s.html

Ignoring the spikes for times of war, we can see that there are many small dips (like 1975-1979) and one long decline between 1991-2001.

7

I’m not finding any cites but I believe that Jefferson reduced Federal spending in real dollars.

8

Yes, except for the year that there was a big spike upward due to a real estate deal! (Seriously, the Louisiana Purchase was more, by itself, than the typical annual federal budget in that era.)