U.S. Budget and Economy

In my prior post , I quoted this link which stated that "the near-term balanced budget projections are illusory" for four reasons. The third reason was that the "Administration projections assume unrealistic deep cuts in nondefense discretionary programs that fund infrastructure, education, public health, disaster relief". This has not been the first time that the Bush Administration has projected deep cuts in outlays that never came to pass. The following graph shows federal receipts and outlays as a percent of GDP since 1980: The actual numbers and sources are here . The red and black lines show the outlays and receipts from the most recent budget, the one for fiscal year 2009. The portions of these lines from 2008 on (to the right of the dotted line) are projections from the 2009 budget. The orange, yellow, green, sky blue, blue, indigo, and violet lines show the projections from the 2008 through 2002 budget, respectively. As can be seen from the red line,...

On July 28th, the Office of Management and Budget released the Mid-Session Review of the U.S. Budget for fiscal year 2009. The following table summarizes updated projections of the deficit and debt from that document, both in billions of dollars and as a percent of GDP: RECEIPTS, OUTLAYS, DEFICITS, AND DEBTS (billions of dollars) Actual Estimate 2007 2008 2009 2010 2011 2012 2013 =========================== ===== ===== ===== ===== ===== ===== ===== Receipts................... 2568 2553 2651 2916 3084 3288 3439 Outlays.................... 2730 2942 3133 3094 3187 3230 3410 --------------------------- ----- ----- ----- ----- ----- ----- ----- Unified deficit(-)/surplus. -162 -389 -482 -178 -103 58 29 On-budget deficit.......... -343 -574 -663 -378 -321 -168 -172 Gross federal deficit...... -499 -672 -815 -505 -482 -375 -38...

On February 15th, Peter G. Peterson announced the formation of the Peter G. Peterson Foundation. Leading the new foundation as President and CEO is David M. Walker, who served as Comptroller General of the United States for the last nine plus years. This page of their website lists the mission of the new foundation as follows: We are dedicated to increasing public awareness of the nature and urgency of several key challenges threatening America's future, and to accelerating action on them. To address these challenges successfully, we will work to bring Americans together to find sensible, long-term solutions that transcend age, party lines and ideological divides in order to achieve real results. Further down the page are listed the challenges of "large and growing budget deficits, dismal national and personal savings rates, and a ballooning national debt that endangers the viability of Social Security, Medicare, and our economy itself". Regarding the debt, this page ...

Note: The following blog entry has been updated at this link : A March 16th New York Times editorial titled Through Bush-Colored Glasses alleged that Bush painted a false picture of the economy in a recent speech. Following is an excerpt: Mr. Bush boasted about 52 consecutive months of job growth during his presidency. What matters is the magnitude of growth, not ticks on a calendar. The economic expansion under Mr. Bush — which it is safe to assume is now over — produced job growth of 4.2 percent. That is the worst performance over a business cycle since the government started keeping track in 1945. I haven't calculated the job growth per business cycle but I have looked at the growth in employment over every presidential term since 1949. The following table shows the monthly average change in population, the labor force, employment according to the Household Survey, total nonfarm employment, and total private employment over every presidential term since 1949, along with the u...

Ralph Nader was a guest on the June 29th program of This Week with George Stephanopoulos. A video of the interview can be found here . For about 4 minutes, George Stephanopoulos and Nader talked about Nader's recent criticisms of Obama. Stephanopoulos then asked the following: Here's what I don't get. Is there any doubt in your mind that Barack Obama would be a better president for your issues, for the things you care about, than John McCain? Nader replied: Well, anybody would be better than the Republicans. Stephanopoulos then asked why Nader trained all his fire on the Democrats, Nader protested that he was simply answering the question he had been asked, and Stephanopoulos replied that this was driven by issues that Nader had raised that week. Nader did go on to spend about 30 seconds making a number of criticisms of McCain. To see firsthand how much Nader was training his fire on Obama versus McCain, I went to Nader's website at http://www.votenader.org/ . The...

My prior post looked at Net Operating Cost and Net Position as presented in the Financial Report of the United States Government. As mentioned, these two measurements are similar to the Unified Deficit and Debt Held by the Public which are presented in the U.S. Budget. The former two measurements are accrual-based and the latter two measurements are cash-based . The Net Operating Cost and Net Position are two of three major items shown in Table 1, titled "The Nation By the Numbers - An Overview", on page 3 of the 2007 Financial Report . The third major item is Social Insurance Exposures. Following is an excerpt starting on page 24 that describes this last item: For the ‘social insurance’ programs (e.g., Social Security, Medicare Parts A, B, and D), the Statement of Social Insurance (SOSI) shows the estimated future scheduled benefit expenses net of contributions and tax income (excluding interest), based on each program’s actuarial trust fund report. Table 8 shows esti...

The Government Management Reform Act of 1994 (GMRA) required the U.S. Government to submit consolidated financial statements audited by the GAO (U.S. Government Accountability Office) beginning with fiscal year 1997's Financial Report of the United States Government. Each year since then, the Administration has issued two reports that detail financial results for the government. These are the President’s Budget and the Financial Report of the United States Government. The following excerpt from page 4 of the 2007 Financial Report describes the difference between the two documents: The Budget's emphasis is on initiatives and how resources will be used , focusing on the Government's spending surplus or deficit. The Report focuses on the Government's net operating cost - how resources have been used to fund programs and services. How does the Government’s largely cash-based spending deficit differ from the largely accrual-based net operating cost? The Budget shows r...