Federal deficit now lowest in 4 years

Yahoo ^

[Sub-Driver]

Federal deficit now lowest in 4 years

By MARTIN CRUTSINGER, AP Economics Writer 4 minutes ago

The federal budget deficit, helped by a gusher of tax revenues, fell to $247.7 billion in 2006, the smallest amount of red ink in four years.

The deficit for the budget year that ended Sept. 30 was 22 percent lower than the $318.7 billion imbalance for 2005, handing President Bush an economic bragging point as Republicans go into the final four weeks of a battle for control of Congress.

Both spending and tax revenues climbed to all-time highs. The sharp narrowing of the deficit reflected the fact that revenues climbed by 11.7 percent, outpacing the 7.3 percent increase in spending.

The 2006 deficit was far lower than the $423 billion figure the administration had projected last February and also represented an improvement from a July revised estimate of $295.8 billion.

It was the smallest deficit since a $159 billion imbalance in 2002, a shortfall that came after four straight years of budget surpluses, the longest stretch that the government had finished in seven decades.

Since that time, the government has recorded three of the biggest deficits in history in dollar terms including an all-time record of $413 billion in 2004.

The reason for the improvement this year was the big jump in revenues, propelled by strong economic strongth.

[Kimberly GG]

"Nancy Pelosi is sadden......"

and just imagine how those 'hardworking' illegal aliens feel out there doing the jobs that American's won't do...I'm listening to Bush and he always forgets to mention them when bragging about the economy...yet, when it's convenient...it gets repeated over and over again that the country's economy would fall apart without them.

[Agrarian]

It's hardly just the war. It is everything under the sun. The justification for this orgy of spending is that al of that spending on pork will keep voters happy with their incumbents and keep the GOP in power. Well, that plan sure worked... not.

We're supposed to be impressed that spending went up only 7% and be happy that the government took 11% more in taxes out of our economy than it did before?

This is balancing the budget Democrat style: Spend more -- and collect even *more* in taxes.

If spending were under control, that 11% in increased revenue could be passed back to the taxpayers in tax cuts.

[cookcounty]

"The federal budget deficit, helped by a gusher of tax revenues, fell to $247.7 billion in 2006, the smallest amount of red ink in four years." and, in real inflation-adjusted dollars, about 1/2 of what it was in pre-Reagan Carter years. Dems are sooo-o-o-o-o-o willfully stupid.

[cookcounty]

"What does that have to do with Republican spending, Mr. Strawman?"

I think the point is that the GOP Congress wants Big Spending, while the Dems in Congress want Big Spending X 2.

It's not the choice you want, but it's still a choice and there is a difference between the two. Personally I prefer High Water to Hell, though like you, I'd prefer High and Dry in the Rockies.

[cookcounty]

"What does that have to do with Republican spending, Mr. Strawman?"

I think the point is that the GOP Congress wants Big Spending, while the Dems in Congress want Big Spending X 2.

It's not the choice you want, but it's still a choice and there is a difference between the two. Personally I prefer High Water to Hell, though like you, I'd rather High and Dry in the Rockies.

[eraser2005]

Really? Where do you get that idea?

From 1977-1980, the on-budget deficit went from 4% of GDP to 2.7% of GDP (there was no SS surplus to raid, as the "surplus" totalled from -0.2% to breakeven)

In 2001, the on-budget deficit was 0.3%, 3.1% in 2002, 5% in 2003, 4.9% in 2004, and 4% in 2005. Are you suggesting that this dropped to half of the 77-80 period (under 2%) in just one year? That would have required the off-budget deficit to fall the better part of $200 billion MORE than it did...

[Southack]

It's great news to lower the annual deficit!




But, what kills me about these threads is that there will always be the unappeasables who post nothing but criticisms even when good news is shown.

[Southack]

"So spending and tax revenues are outpacing economic growth at least two to one."

Have you ever thought to ask "How" can new revenues outpace economic growth?!

[SaltyJoe]

I've wondered the same thing and reflect what how might this be viewed from a Supernatural height?

Matthew 11

16
"To what shall I compare this generation? It is like children who sit in marketplaces and call to one another,
17
'We played the flute for you, but you did not dance, we sang a dirge but you did not mourn.'

Footnote:
http://www.nccbuscc.org/nab/bible/matthew/matthew11.htm#foot11

I think the devil divides the hearts of men and turns us against each other so that we'd be too distracted to look upon Jesus' Perfection...but I'm not Bible study qualified.

[caresistance]

You understand why nothing changes, too many tow that party line, while we sink into fiscal oblivion. Celebrating a quarter trillion dollar yearly deficit, how Orwellian!! hilarious exchange moving down the thread, the true believers frighten real fiscal conservatives.

[Moonman62]

Wouldn't it be a good thing if spending grew at the rate of GDP growth or less?

[remember]

$247.7 Billion is a complete bald-faced lie.

What about the $180 billion or so raided from the Social Security surplus?

How about the Treasury's financial report? Last year that was a $760 BILLION net operating loss. Assuming the same ~70 Billion reduction, that's what, ONLY $690 Billion?

Pocket change!! The GOP is doing a fantastic job

/supreme sarcasm

Agreed. The following table shows the federal debt over the past decade as given by the Treasury Department:

           TOTAL FEDERAL DEBT (billions of dollars)

                                 Intra-
  Fiscal   Debt Held              Gov't              Total
 Year End  by Public   Change  Holdings   Change      Debt   Change
---------- --------- -------- --------- -------- --------- --------
 9/29/2006    4843.1    241.9    3663.9    332.4    8507.0    574.3
 9/30/2005    4601.2    293.9    3331.5    259.8    7932.7    553.7
 9/30/2004    4307.3    383.3    3071.7    212.6    7379.1    595.8
 9/30/2003    3924.1    370.9    2859.1    184.1    6783.2    555.0
 9/30/2002    3553.2    213.9    2675.1    206.9    6228.2    420.8
 9/28/2001    3339.3    -66.0    2468.2    199.3    5807.5    133.3
 9/28/2000    3405.3   -230.8    2268.9    248.7    5674.2     17.9
 9/30/1999    3636.1    -97.8    2020.2    227.8    5656.3    130.1
 9/30/1998    3733.9    -55.8    1792.3    168.9    5526.2    113.0
 9/30/1997    3789.7             1623.5             5413.1

Source: U.S. Department of the Treasury, Bureau of the Public Debt,
        online at http://www.publicdebt.treas.gov/opd/opdpdodt.htm

As can be seen in the last column, the total debt increased $574 billion in the fiscal year that just ended, over $20 billion MORE than it increased during the prior fiscal year. According to the third column, the debt borrowed from the public did increase $242 billion, $52 billion less than last year. However, this ignores the hundreds of billions being borrowed from the trust funds, especially the Social Security trust fund. From those, the government borrowed over $72 billion more than last year, increasing the total borrowing by over $20 billion. Hence, the true deficit problem is not getting better and is currently caused by the general fund, not by entitlements.

[WhiteGuy]

Excellent work, Thank you.

[Huck]

Thanks for the ping.

[eraser2005]

BRAVO!

[dynoman]

Huh, you are right, I've always been curious about that;

09/30/2000 $5,674,178,209,886.86
09/30/1999 5,656,270,901,615.43
09/30/1998 5,526,193,008,897.62
09/30/1997 5,413,146,011,397.34
09/30/1996 5,224,810,939,135.73
09/29/1995 4,973,982,900,709.39
09/30/1994 4,692,749,910,013.32
09/30/1993 4,411,488,883,139.38
09/30/1992 4,064,620,655,521.66
09/30/1991 3,665,303,351,697.03
09/28/1990 3,233,313,451,777.25

http://www.publicdebt.treas.gov/opd/opdhisto4.htm

So how in the world was the four years of surplus passed off on the public?

It torques me every time I hear the term "public debt" as if us general public had anything to do with generating that debt.

[eraser2005]

The "surplus" was based on using on-budget numbers. That number includes surpluses of trust funds in with general revenues. In other words, it is like claiming profits while ignoring your most significant liabilities, simply because you can always cancel the program. Consider it like a company with a nice pension plan claiming a huge profit while not counting any money needed to fund that plan. Illegal in the business world - standard practice in government.

There were two years in which the on-budget numbers showed a small surplus. That means those years there was a surplus without having to raid SS, etc....

However, debt still increased. How? There are still things not accounted for in the on-budget #s, and the outstanding debt at 9/30 does not always correlate perfectly with the fiscal year. Some tax payments come in early/late, payments are pushed ahead based on what day of the week 9/30 is, etc...

When all that comes into play, 2000 was pretty much a balanced budget - 9/30 was a Saturday, and 10/1 a sunday, so some items were pushed forward to 9/29 that really should have hit 2001's numbers instead.

But the real analogy is still like a company claiming an operating profit, but having negative cash flow and a net loss

[dynoman]

Thinking about that a little more how in the world can the budget be balanced in any sense of the word when the public debt went up every year in the 1990s? Is that Enron accounting or what? There isn't one year since 1960 the "public debt" didn't increase.

Here is another interesting way of looking at the "Public Debt";

09/30/2005 $7,932,709,661,723.50

09/30/2000 $5,674,178,209,886.86

09/28/1990 3,233,313,451,777.25

12/31/1980 930,210,000,000.00

12/31/1970 389,158,403,690.26

12/30/1960 290,216,815,241.68

06/30/1950 257,357,352,351.04

The biggest change was in the 80s.

http://www.publicdebt.treas.gov/opd/opdhisto4.htm

Oh and any who would like to make a gift contribution to reduce the public debt might be interested in this;

http://www.publicdebt.treas.gov/opd/opdgift.htm

Looks like most of the public feels just as peeved as I do about the "Public Debt".

[dynoman]

"That number includes surpluses of trust funds in with general revenues. In other words, it is like claiming profits while ignoring your most significant liabilities, simply because you can always cancel the program. Consider it like a company with a nice pension plan claiming a huge profit while not counting any money needed to fund that plan. Illegal in the business world - standard practice in government. "

Hmmm, is that what "Intragovernmental Holdings" are?

http://www.publicdebt.treas.gov/opd/opdpdodt.htm

Enron accounting.

Why have we let our government do this to us?

[Lakeshark]

I think the more important point is why a deficit grows, and why it shrinks, don't you?

Or do you actually think that Clinton personally shrank the deficit? If so, how? He never ran on it, never said that was his goal, rather, he inherited a booming economy (after lying that it was the worst ever), and a post cold war world (which he and his party did nothing to help gain) that formed a tidal wave of economic growth that shrank the deficit. It surprised him as much as anyone that the economy outgrew the deficit, then he made sure to take credit for the nothing he had done.

Sorry.....that's the truth....but I suspect you can't handle that one.