GDP Growth Under Bush and The Free Market is More Efficient

So someone sent me the following Link as proof that tax cuts spur the economy. It was immediately followed by the statement that "It is a fundamental rule of capitalism that the free market spends money for efficiently than the federal government".

First of all, trying to use the first link as proof of anything makes me wonder if all the Bush-ites failed math. The more they send me, the more I begin to think so. Makes it hard to have an intelligent discourse if they don't understand how to analyze a data set.

GDP Growth in Dollars

Looking at this graph, this isn't year over year growth, but simply growth. Inflation alone should power it upwards, unless you have a serious recession/depression. From just glancing at it, it looks fairly linear when adjusted for inflation, maybe exponential with an inflection in the 60's. Somehow, this is supposed to prove the Bush tax cuts were amazing. But, since it's such a long data set, let's look at the past 20 years to see what happens.

Adjusted GDP Growth with Trendline

And this is what happens when you actually look at the data that is presented to you. Under Bush we actually see GDP falling under the 20 year trendline, until a massive jump, just before the recession. Well that must mean the tax cuts work! Or, GDP was inflated due to massive levels of debt, which is demonstrated as GDP immediately falls off during the recession and returns to its 20 year trendline. And yes, a linear line fits with a 95% fit.

Finally, the second point. Hopefully I can find some data on the subject, but if you have any, please share. From just a simple thought experiment, it seems to me that both private industry and government should have the same level of inefficiency. At one point, private industry should easily have won out due to the bureaucracy involved in the federal government and lack of competition. However, private industry has devolved to the point where you have a few slow moving players with multiple levels of (mis)management. Every dollar they earn doesn't go to growth. They have insurance, interest on debt, taxes on property, marketing expenses, overhead expenses, employee health plans, retirement plan contributions, etc. Most importantly, how much of every dollar they make in revenue stays in the US?

I no longer think it is a fundamental rule of capitalism that private industry is more efficient. Both private industry and government are models of inefficiency. The only exceptions are hot startups through their early life, until they eventually become too large and hit the inefficiency wall (Google).