Picture of the Day: Growth Private and Public

Via The New York Times' Economix blog, this graph comparing private sector growth and public sector growth:

Quarterly change at seasonally adjusted annual rate.
Source: NYTimes. Data source: Bureau of Economic Analysis

You can have your own correlation and causation debate here: shrinking government  returned the private sector to growth or held overall growth down hurting the private sector.  I am in the latter camp: in a time of recession the severe austerity imposed at the state and local levels have had a big role in suppressing growth.

Update: Here is Krugman posting on the same thing.