The Federal Deficit and federal Debt are receiving a little bit of attention after an eight year period of actively ignoring the data. The Unpatriotic and irresponsible debt that increased from $5 trillion to $19 trillion under President George W. Bush, including the TARP Program that was almost completely repaid under President Obama, the vast majority of which was repaid with interest. The irresponsible and unpatriotic debt nearly doubled under President Obama, increasing from $10 trillion to over $19.8 Trillion under President Obama, even with the repayment of TARP. This column has written numerous articles on this topic. What needs attention is that "off-budget" item are not off-budget. The corporate taxes have not started rolling into the Treasury, Interest on the debt is soaring. So what else is in the November Treasury Report?
Revenue is Up - Even with Non-Existent Corporate Taxes. On-Budget Revenue is up 15 billion dollars over last year at the same point in time. Off-budget Revenue is up 6 billion dollars. Revenue is code for taxes
Spending is Up - $48 Billion on-budget. Off-Budget Spending is up 4 Billion. There is a ton of discussion regarding reigning in "non-discretionary spending" or "Entitlement Spending." Do the math. If "Off-budget" revenue is up $6 billion and off-budget spending is only up $4 billion then "off-budget" expenditures are running a surplus. On-budget spending is up $33 billion more than revenue. On-budget spending is the cause of the deficit.
Individual Taxes are Up $15 Billion - Corporate Taxes are DOWN $1.5 Billion. Placing this in perspective, remember that last year the corporate revenue was $297 billion. Individual taxes came in at $1.587 trillion dollars. Also remember that most corporations pay quarterly taxes and that quarterly taxes are paid during April, June, September, and December. There is "no corporate revenue" because they have not been required to pay their first round of quarterly taxes this fiscal year.
Interest on the debt this year is $62 billion, so far. This is up from $51 billion during October and November of 2016. The authors of the report are projecting $503 billion dollars for the interest on the debt this year. The same authors are projecting a $534 billion on-budget deficit and a $* Billion off-budget Surplus. Think about it - almost all of our deficit spending is due to interest on the debt. It was going to take 30 years of monthly "mortgage payments" of $117 billion a month to pay down an $18 trillion debt during Thanksgiving of 2014. We have mortgaged our future. We have added over $2 trillion to the debt in just over 3 years.
The solution is fairly simple. Start by not spending more than was taken in in revenue the prior year. Remove "off-budget" items - revenue and spending - from the monthly Treasury Report. Start paying down the debt - which may start when Quantitative Tightening begins.
It;'s the economy.
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