US deficit surges 25 pct. in fiscal 2020

Sort by newest Sort by date
tsptalk

tsptalk

Moderator
Staff member
Reaction score
1,589
US deficit surges 25% in fiscal 2020 and is $1.1 trillion over the past year

The budget deficit for the first four months of fiscal 2020 is $389.2 billion, the Treasury Department reported.

That’s a 25% gain from the same period a year ago.

Over the past 12 months, the gap has been nearly $1.1 trillion as the national debt has swelled past $23 trillion.
Click to expand...

https://www.cnbc.com/2020/02/12/us-...-2020-up-1point1-trillion-over-past-year.html


---------------------------------------------------------------------------------------------

Will the spending ever slowdown? Not likely. Neither party seems interested. We've gotten away with it for a long time so the question is, will it matter to us in our lifetimes? Sorry kids and grandkids! It looks like you'll have to deal with it.





 
Tom,

If I can trust the blub from the 'Wall Street Journal' quoted in Instapundit this large quarterly deficit is a statistical anomaly:

The U.S. budget gap totaled $389 billion from October through January, compared with $310 billion in the same period a year earlier, the U.S. Treasury Department said Wednesday. Federal outlays rose 10%, to $1.6 trillion, and federal tax receipts grew 6%, to $1.2 trillion—both record highs for the four-month period.

Spending rose sharply because Feb. 1, the date on which certain benefits are paid, fell on a Saturday, shifting those payments into January. If not for that shift, the deficit would have been only 6% larger, and receipts and outlays each would have risen 7%.
…
As a share of gross domestic product, year-over-year deficits were 4.9%, compared with 4.3% in the previous 12 months. That was the highest deficit/GDP ratio since May 2013, when the unemployment rate was 7.5% and real GDP grew just 0.12% from the previous quarter.
Click to expand...

What may actually prove interesting is that revenue growth is accelerating and spending growth is decelerating. This happened during the 'W' Presidency as well, but the differential shrink was slow. I mean, in FY2007 the deficit was just $165 Billion - which is rounding error... I am very concerned that the current revenue/spending is following the same pattern - and again it will correct itself too slowly to actually eat into the debt.

Nobody should pretend that this President/Congress is getting spending under control. However, nobody seems to care. My guess is that the next downturn will be terrible, long lasting, and government centered.
 
Just confirms what has happened in the late 1980's, in the mid 2000's, and again today.
Massive tax cuts NEVER, ever, do anything other than blow up deficits out of the water.
The "growth" that always occurs when you increase your credit card usage, never outweighs the even faster debt (and interest on the debt) that accumulates.

Thats why "Keynesian Economics" is only meant to be used in short spurts, like the 2008-09 Super Recession, to be quickly replaced by gradual tax hikes which combine with a growing economy to shrink deficits.

tsptalk said:
US deficit surges 25% in fiscal 2020 and is $1.1 trillion over the past year



https://www.cnbc.com/2020/02/12/us-...-2020-up-1point1-trillion-over-past-year.html


---------------------------------------------------------------------------------------------

Will the spending ever slowdown? Not likely. Neither party seems interested. We've gotten away with it for a long time so the question is, will it matter to us in our lifetimes? Sorry kids and grandkids! It looks like you'll have to deal with it.
Click to expand...
 
tsptalk said:
Revenues are at an all time high so I'm more inclined to think it's a spending problem. But I digress. :o

https://www.thebalance.com/current-u-s-federal-government-tax-revenue-3305762
Click to expand...

Well revenues are always higher because of every year since 2009 we've experienced growth, but what would revenues, and deficits be if we kept the same tax rates from 3 years ago, both income and corporate, in place?
Would we even have a deficit today?
I also like to digress. :smile:
 
I like to use the 'Monthly Treasury Statement'. Not worth looking at budget numbers when one is already into the grand and glorious spending!!!

FireWeatherMet, it ain't the revenue - which has grown $195 Billion since the FY2016, it is spending which has grown by $593 Billion. Out of that $131 Billion of the growth is Off-Budget (Social Security and Medicare). Spending in the DoD has grown $89 Billion. I will have to do more research to figure out where the rest of the bloat has come from. But, that is why I provided the link!!!

Anyway, I did not vote for the Trumpster. Anyone that thought someone who funded the Clinton campaigns and New York Democratic candidates in elections would be a fiscal conservative has a screw loose. He is a big spender who hopes he is spending in such a way that the Future Return On Equity will exceed Outlay. That is how a company borrows. But, the Trumpster is a real estate grinder. They go big or go home. Ugh...

The game has been over for some time anyway. When the annual budget expenditures grew by $800 Billion sustained in FY2009 the game was up. Had we kept to inflation adjusted FY2007 spending (and peaked only as necessary) than our expenditures would be $3.366 Trillion now - and we would have a $96 Billion surplus!!! The Game Over Gun went off in FY2009.
 
I just want that same kind of unlimited credit line,
no payment required
massive unlimited debt ceiling credit card,
just like my Uncle Sam has.

visa-and-mastercard-logo-26.jpg
 
We're what, a good 4-5 years away, but I think the personal income tax cuts are supposed to expire. Not sure if this would put a dent in the deficit..
 
jonfresno said:
We're what, a good 4-5 years away, but I think the personal income tax cuts are supposed to expire. Not sure if this would put a dent in the deficit..
Click to expand...

Nope, why would it.

Comparison of FY2019 (September 30, 2019) with FY2016 (September 30, 2016)
  • Personal Income Taxes are up $172 Billion.
  • Corporate Income Taxes are down $70 Billion.
  • Social Security Off-Budge revenue is up $104 Billion.

More people are working at higher wages (adjusted for inflation) and paying into personal income taxes and Social Security taxes. Corporate income tax revenue growth is accelerating.

Here is an example of why reverting personal income taxes back to FY2016 would not be a good idea: I will play legal tax games again. I will NOT pay higher taxes. Nothing illegal, just more aggressive. My income taxes are so easy to work with (no looking around for dumb write-offs, deductions and stuff) and they feel fair. I just pay them!!!
 
Boghie said:
Nope, why would it.

Comparison of FY2019 (September 30, 2019) with FY2016 (September 30, 2016)
  • Personal Income Taxes are up $172 Billion.
  • Corporate Income Taxes are down $70 Billion.
  • Social Security Off-Budge revenue is up $104 Billion.

More people are working at higher wages (adjusted for inflation) and paying into personal income taxes and Social Security taxes. Corporate income tax revenue growth is accelerating.

Here is an example of why reverting personal income taxes back to FY2016 would not be a good idea: I will play legal tax games again. I will NOT pay higher taxes. Nothing illegal, just more aggressive. My income taxes are so easy to work with (no looking around for dumb write-offs, deductions and stuff) and they feel fair. I just pay them!!!
Click to expand...

I think the part you are missing, is what would Income revenue be if we were at 2016 tax rates?
But I agree, we have been spending more, almost entirely the big spending increase has been in Defense. Domestic spending non defense has been near stationary...some agencies cut significantly, a few up a little. Same problem as the 1980's.
Defense Budget in FY 2017 (started fallof 2016) was 523 Billion. This past year its over 680 Billion. 160 Billion Increase. Nothing else discretionary-wise even comes close.
If tax rates had stayed the same, it would be interesting to calculate the revenue difference.
 
Last edited:
You must log in or register to reply here.
Back
Top