Posted on 09/19/2019 4:38:11 AM PDT by gattaca
The Congressional Budget Office reported on Tuesday that, with one month to go, the federal deficit for fiscal year 2019 has already topped $1 trillion. As night follows day, Trump administration critics blamed the tax cuts.
And once again, the data prove them wrong.
The CBO report says that the federal deficit reached $1.067 by the end of August. That’s up $168 billion from the comparable period in fiscal year 2018. The deficit this year will be larger than the entire budget was in 1987.
Where did the increase come from? Why, tax cuts, of course.
But the report shows that revenues climbed 3.4% so far this fiscal year. Spending, however, shot up by 6.4%.
Look within the data, in fact, and you see that the tax cuts are working as promised – by accelerating economic growth, they’re at least partially paying for themselves.
Take corporate taxes. Ask any Democrat running for president and they will bemoan the tax “giveaways” to giant corporations. What they won’t tell you is that corporate tax revenues are up 5%.
In fact, corporations paid $8 billion more in the 11 months of this fiscal year than they did in the same period of fiscal year 2018. That increase alone is enough to fully fund the Environmental Protection Agency for an entire year.
What’s more, the CBO notes that corporate income tax payments through May were on 2018 activities. When you compare corporate taxes from June through August to same months last year, they are already up $18 billion – a 48% increase!
Meanwhile, individual income and payroll taxes are up $82 billion – a 3% increase over the prior year. Payroll taxes alone, which are a good indication of how well the job market is because they are automatically deducted from every worker’s wages, are up 6.4%.
Now look at the spending side of the equation.
The CBO report shows that while revenues have climbed by $102 billion, spending shot up by $271 billion.
The entire increase in the deficit over last year is due to rampant spending increases, not the Trump tax cuts.
Spending increases were across the board.
Social Security costs climbed 5.7%; Medicare, 6.5%; Medicaid, 4.6%.
Defense spending is up 7.9%, but spending on everything else in the budget has climbed by 4.5%.
Here’s the really worrisome figure: Interest payments on the national debt is up 14% over the prior year.
It should go without saying that these levels of spending growth are unsustainable. Yet instead of confronting them, lawmakers and the Trump administration are aggravating them. Entitlement reform is a non-issue at the moment. Every increase in defense spending has to be matched with a hike in spending on domestic programs. The national debt continues to explode.
And while Republicans appear indifferent to the debt explosion, Democrats are eager to more than double the size of the federal government, without saying how they’d pay for that increase let alone bring existing annual deficits down to earth.
To paraphrase Herbert Stein, something that can’t go on forever, won’t. The only question is when it won’t.
The deficit is that high because the government is a big polluter which has persuaded people they are the culprits in destroying the planet, not the the leviathan wasteful government.
aaaaaand The House owns the purse strings
The entitlement programs will continue to increase as the population ages. 10,000 baby boomers retire every day and will continue to do so at that rate until 2030. The entitlement programs, Medicaid, food stamps, and debt servicing costs comprise two-thirds of the federal budget and are on automatic pilot.
“Here’s Another Clue For You All”
The walrus was Paul
“The entitlement programs, Medicaid, food stamps, and debt servicing costs comprise two-thirds of the federal budget and are on automatic pilot.”
Well, sorta.
Congress can disable that feature any time they damn well please.
Exactly. A fact that will be missed by more than 90% of the American public, who'll easily be misled by the lying liberal lamstream media that it's Trump's fault.
SMH. We really need Civics and Constitution classes restored in this country.
....the walrus was Paul
h/t "Glass Onion"
In order to make sense out of the information in this article, one must first understand what the ‘deficit’ is.
Most people don’t really know what the deficit is, or the national debt, nor why the interest goes up or down.
Who here can explain these terms?
If you are against an import tariffs then shut up about the deficit. You have no right to complain.
Look at the GDP figures for the second quarter of 2019. The biggest contributor to our 2% growth was a 15% increase in the “Government, Non-Defense” sector.
Partially paying for themselves. Long and short is that if you aren't raising revenue you have to cut spending. And when you don't do that and the small increase in revenue you do have is offset by larger increase in spending then that's why you have trillion dollar deficits.
Aaaaaaand if the GOP controlled the House as well as the Senate the deficit would be as bad or worse.
The automatic pilot feature of COLAs will not be shut off by Congress. The only way it will end would be if the trust funds are exhausted (SS in 2034 and Medicare in 2026) and benefits could only equal revenue collected.
Many are not aware that 40% of Medicare costs are paid from the General Fund. By law, the premiums for Medicare Part B and D cover only 25% of the costs. The rest comes from the General Fund. Also, 9 out of every 10 Medicare recipients have supplemental, private insurance to cover the costs that Medicare does not, i.e., Medigap insurance. I wonder why no one has asked Bernie and Warren about this.
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