Free Republic

The International Monetary Fund sounded the alarm on the Biden administration’s rampant spending as “out of line with what is needed for long-term fiscal stability.” The latest forecast from the IMF — a Washington-based group tasked with fighting financial crises worldwide — warned that the ballooning national debt and the fiscal deficit threatened to exacerbate sky-high levels of inflation while posing a long-term risk to the global economy. The IMF noted in its forecast that the US federal budget deficit grew from $1.4 trillion in fiscal 2022 to $1.7 trillion last year. ... The debt held by the public, which...

Washington continues to spend like deficits and debt don’t matter, and the politicians would rather you don’t know. For the record, the Congressional Budget Office reported Monday that the federal budget deficit for the first six months of fiscal 2024, ending in March, was $1.064 trillion. Enjoy it, because you’ll eventually pay for it in higher taxes. The problem isn’t a shortage of tax revenue, which rose 7% from a year earlier to $2.19 trillion. Individual income-tax and payroll-tax revenue both rose 6%, while corporate income taxes rose 35%. Is a 7% increase what President Biden would call a “fair...

Restaurants, recalls and resistance are giving California Gov. Gavin Newsom one of the worst months of his political career. California held its presidential primary election on Super Tuesday, March 5, but it was far from super for the state’s ambitious governor. Voters showed more than a little resistance to passing the ballot measure Newsom had branded with his name and image in TV ads for which he had raised $20 million. Given the razor-close outcome, what was really shocking was the amount spent to oppose the governor’s effort: nothing at all.

The deficit, in this discussion, is an annual number. It is the amount that tax revenues are less than spending by Congress. In other words, Congress is spending six-plus percent more each year than the government can cover by taxing citizens. Economist Brain Wesbury on the deficit and debt: Last week the Congressional Budget Office set out new projections for budget deficits and debt in the decade ahead, and they weren’t quite as bad as they looked last year. The CBO now projects a deficit of 6.4% of GDP in 2033 versus a prior forecast of 7.3%. Total accumulated debt...

Catherine Rampell of the WaPo is correctly recognizing that states are sabotaging their finances. While she recognizes the coming problem, she blames tax cuts instead of overspending and depending on the rich as the culprit. Democrats rarely think they spend too much and rarely want to allow the people and businesses to keep more of what they earn. As recession looms (maybe), states sabotage their own financesRampell, like most journalists, has falsely blamed Trump's tax rate cuts for cutting federal revenues when revenues actually rose substantially after the rate cuts. Overspending has always been the problem in DC.Many states sabotaged...

The United States on Thursday announced a huge $2.5 billion weapons package for Ukraine, including 90 Stryker combat vehicles, the first time Washington has committed the system to Kyiv. The new lethal assistance — announced a day ahead of a gathering of top Western military officials for the Ukraine Contact Group in Germany — includes hundreds of armored vehicles, thousands of artillery rounds and new Avenger air defense systems pulled from U.S. weapons stockpiles.

“I suspect that you will continue to hear coming from the United States additional packages of security assistance, additional weapons and capabilities for Ukraine – perhaps as soon as the end of this week,” White House National Security Council spokesperson John Kirby told CNN.Kirby didn’t elaborate on the contents of the package but said that the U.S. was concentrated “on trying to make sure that we are giving Ukraine what they need in the fight that they’re in.”“We’re gonna continue to modulate these packages so that they’re most appropriate for what Ukraine need

Back in May, California Gov. Gavin Newsom gleefully boasted that the state of California had a nearly $98 billion surplus after operating in the black for multiple years. But, now that Newsom’s been safely reelected, new projections show that the state of California will have a $25 billion deficit in the 2023-2024 fiscal year. “That shortfall, according to a new report from the state’s independent Legislative Analyst’s Office, could be followed by continued annual budgetary gaps between $17 billion and $8 billion for the subsequent three years,” reports the Sacramento Bee. “If the forecast holds true through June, when the...

Americans are rightly concerned about deficit spending in the United States, especially as directed by the perpetually reckless Congress that is constitutionally mandated to care for the purse strings of the nation. At present, the President, the House, and the Senate are locked in a strange budget battle that aims to spend trillions of dollars in the years ahead. These proposals are in addition to a standardized set of costs that are around four to five trillion dollars. The increase in spending is primarily rooted in promises made by President Biden in his campaign and amplified by a growing radical...

The U.S. economy is expected to shrink at an annual rate of almost 40% in the second quarter, and the budget deficit will explode, the nonpartisan Congressional Budget Office said Friday. [snip] The CBO chief said the budget deficit would hit a nominal record of $3.7 trillion, well above the $1.413 trillion seen in 2009. The impact of the sharp drop in output on the government’s bottom line would be sharp. In addition to the $3.7 trillion 2020 deficit, the CBO said government debt held by investors and other members of the public would reach 101% of the size of...

Federal spending programs that are "designed to transfer income ... to individuals or families" are set to hit a record $3,223,943,000,000 in fiscal 2020, according to projections published by the Office of Management and Budget. These so-called "payments for individuals" (as the OMB calls them) are projected to account for 67.9% of all federal spending this fiscal year and consume 14.4% of the nation's gross domestic product. In its Historical Table 6.1, Composition of Outlays, the OMB reports the annual amounts spent on "payments for individuals" going back to fiscal 1940 in both current year and constant fiscal 2012 dollars....

Not that long ago, China’s economy was seen as a juggernaut that would soon overtake America’s to become the world’s largest. “Made in China 2025,” the Chinese government’s blueprint to take over manufacturing, was seen as an existential threat to U.S. technological leadership. Speculation had the Chinese yuan replacing the United States dollar as the world’s reserve currency. What a difference a trade war makes. No one marvels at the Chinese economy today. Car sales in China, the world’s largest car market, plummeted by 19 per cent in December, capping a six-per-cent decline in sales for the 2018 year, the...

RUSH: Yeah, another thing that’s so frustrating to me about all this honestly, folks, is that Donald Trump has really made good on his promise to make America great again and then is in the process of reshaping the world. Do you realize…? Have you heard the ChiComs have agreed to start importing rice from the United States? Now, stop and think about this for a second. Donald Trump sold ice to Eskimos. He has just made a deal where the ChiComs are gonna import rice from American farmers. The ChiComs on all of these arguments over tariffs are gonna...

Maybe Donald Trump is such a powerful communicator and pot-stirrer that other countries, embarrassed by their own trade barriers, will eliminate them. Then I will thank the president for the wonderful thing he did. Genuine free trade will be a recipe for wonderful economic growth. But I fear the opposite: a trade war and stagnation -- because much of what Trump and his followers say is economically absurd. "(If) you don't have steel, you don't have a country!" announced the president. Lots of things are essential to America -- and international trade is the best way to make sure we...

In "Hamlet," Shakespeare pens one of the most familiar lines -- and best advice -- ever written. Before Laertes leaves for Paris, his father, Polonius, tells him: "Neither a borrower nor a lender be..." We have ignored that advice for far too long, which is why the U.S. national debt is $20 trillion with more to come, thanks to the Republican Congress, which has passed a two-year spending bill that calls for $300 billion in new spending and removes caps applied by the Budget Control Act of 2011. It's being sold to the public with the highest and purist motives....

President Trump on Monday rolled out a White House budget that includes deep cuts to some federal agencies, an increase in funding for the Pentagon and $18 billion for a wall on the Mexican border. It includes proposals to cut deficits by more than $3 trillion over a decade and lower debt levels as a percentage of the gross domestic product, but does not balance by doing away with annual deficits.

The White House on Monday will unveil its long-awaited $1.5 trillion infrastructure package aimed at overhauling U.S. public works. The plan is structured around four goals: generate $1.5 trillion for an infrastructure proposal, streamline the permitting process down to two years, invest in rural infrastructure projects and advance workforce training. The current system is fundamentally broken and it’s broken in two different ways,” a senior administration official told reporters in a Saturday phone call. “We are underinvesting in our infrastructure, and we have a permitting process that takes so long that even when funds are adequate, it can take a...

Allow me to confess that I’ve been right out there with the best of them (or is it the worst?) when it comes to high-fiving and back-slapping over the positive results of the tax cuts enacted before Christmas. Businesses are hiring, handing out bonuses and onshoring capital. Workers are seeing more money in their paychecks and will see significant benefits when they file their taxes next year. Yes, there is plenty to celebrate, but there’s also a second, far less pleasant reality to contemplate.As the WaPo reports this weekend, the federal government is now on track to borrow a massive...

The good news is that there's a debate in Washington about how to make the tax code less destructive. The bad news is that lawmakers will be able to achieve much less than they otherwise could because of bad policy priorities. It's obvious that Congress and the White House are unwilling to cut or even restrain spending to pay for tax reform. Indeed, the budget resolution that passed the Senate calls for a tax reform bill that would increase the deficit by $1.5 trillion over ten years with no savings worth mentioning. As a result, there's little leeway to mix...

California’s projected budget deficit is rising. “Gov. Jerry Brown’s administration miscalculated costs for the state Medi-Cal program by $1.9 billion last year, an oversight that contributed to Brown’s projection of a deficit in the upcoming budget, officials acknowledged this week,” the Associated Press reported today. California’s projected deficits could have been avoided by curtailing wasteful spending. As the Reason Foundation notes, California spends more money to get worse roads than most states. […] California’s legislative analyst projected last year that the recent increase in the state’s minimum wage to $15 an hour will cost taxpayers $3.6 billion more a year...