House approves changes to budget rules

NF Reporter · 01-05-2007, 06:55 PM

AP - Resurgent House Democrats voted Friday, their second day back in control, to block future tax cuts or benefit increases from being financed with dollars that swell the national deficit.

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waltky · 09-04-2007, 01:51 PM

Smoke and mirrors...

Fuzzy Bush math
September 4 2007: You're about to hear that the budget deficit is falling. Don't believe it, warns Fortune's Allan Sloan. The deficit is much, much bigger than you think.

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There will be lots of celebrating in Washington next month when the Treasury announces that the federal budget deficit for fiscal 2007, which ends Sept. 30, will have dropped to a mere $158 billion, give or take a few bucks. That will be $90 billion below the reported 2006 deficit, and will be toasted by the White House and Treasury as a great accomplishment. But I have a nasty little secret for you, folks. If you use realistic numbers rather than what I call WAAP -- Washington Accepted Accounting Principles -- the real federal deficit for the current fiscal year is more than 2 1/2 times the stated deficit.

Why am I inflicting this information on you? Because there's been so much joyous noise about the budget emanating from Washington, despite the subprime mess and market meltdowns (which don't bode particularly well for future tax collections), that my natural contrarianism makes me feel like bombing the buzz machine. In addition, so many investors (and speculators) are fleeing to the supposed safe haven of Treasury securities lately that it's a good time to take a look at what's really going on with the federal budget.

If a publicly traded corporation tried keeping books the WAAP way rather than the GAAP (Generally Accepted Accounting Principles) way, its auditors would be on the phone to the SEC before you could say "Sarbanes-Oxley." But this is the federal government, which operates its unique budget accounting system regardless of which party's running the show. Making the deficit look smaller than it really is helps whoever's in power, be it today's borrow-and-spend crew or yesteryear's tax-and-spenders.

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waltky · 09-29-2007, 01:44 PM

Are we putting too much on credit?

United States Congress agrees to raise U.S. credit limit
Saturday, September 29, 2007 - With the U.S. government fast approaching its current US$8.965 trillion credit limit, the Senate on Thursday gave final congressional approval of an US$850 billion increase in U.S. borrowing authority.

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The Senate voted 53-42 to raise the debt ceiling to US$9.815 trillion, the fifth increase in the U.S. credit limit since President George W. Bush took office in January 2001. The U.S. House of Representatives approved the higher debt limit earlier this year as part of the overall budget resolution and the legislation now goes to Bush for his signature. U.S. Treasury Secretary Henry Paulson commended Congress for quickly passing legislation he said "ensures the U.S. government can deliver on promises already made."

"The Senate's swift action on the debt limit today helps to protect the full faith and credit of the United States and avoids creating unnecessary uncertainty in the U.S. Treasuries market," Paulson said in a statement. The Treasury Department had been pressing Congress to pass the debt increase quickly. Last week Paulson said the government would hit its current US$8.965 trillion debt limit on Oct. 1. But Sen. Tom Coburn, an Oklahoma Republican, urged lawmakers to reject the debt increase and concentrate on spending cuts instead.

"Families across America don't have the luxury of loaning themselves any money when they've maxed out their credit. But that's what we're going to do," Coburn said. Lawmakers said the US$850 billion increase in borrowing authority, the second largest since Bush took office, should be enough to last the government through next year's congressional and presidential elections. U.S. debt stood at about US$5.6 trillion at the start of Bush's presidency.

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waltky · 03-13-2008, 12:52 AM

Deficit gets bigger...

Federal Budget Deficit Swells
Wednesday, Mar. 12, 2008 (WASHINGTON) — The Treasury Department says the federal deficit swelled to $263.3 billion in the first five months of this budget year as record spending during the period outpaced record revenues.

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The department's latest snapshot of the government's balance sheets, released Wednesday, shows that the deficit for the budget year that began Oct. 1 was up a whopping 62 percent from the red ink of $162.2 billion for the corresponding five-month period last year. The latest year-to-date budget deficit of $263.3 billion was an all-time high, the government said. Spending totaled a record $1.23 trillion, while revenues totaled $967.2 billion, also an all-time high.

For the month of February alone, the government ran a deficit of $175.6 billion, a record for any single month. That was larger than the shortfall of around $170 billion that economists were expecting. One of the reasons the deficit was running higher was related to a calendar issue, the Congressional Budget Office said. Because March 1 fell on weekend, payments that the government would ordinarily have made in March were instead made at the end of February. That caused spending to be higher in February, contributing to the larger budget deficit.

The White House predicts that the deficit this year will increase to $410 billion, as the economic slowdown cuts into tax revenues. Many analysts predict economic growth will be feeble in the January-to-March quarter; a growing number believe the economy is actually shrinking now. Under one rough rule, the economy would need to contract for six straight months to be considered in a recession.

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waltky · 08-13-2008, 01:07 AM

Granny says is `cause all dem politicians spendin' all our tax money...

Budget deficit has tripled since last July
Tues., Aug. 12, 2008 WASHINGTON - Budget deficit soars to $102.8 billion in July; Deficit is nearly triple the $36.4 billion deficit recorded a year ago

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The federal budget deficit soared in July, pushed higher by economic stimulus payments and $15 billion in outlays to protect depositors at failed banks. The Treasury Department reported that the deficit for July totaled $102.8 billion, nearly triple the $36.4 billion deficit recorded in July 2007. The deficit outstripped the $97 billion gap that Wall Street economists had been expecting for July.

The Treasury said outlays were pushed up by $15 billion because of payments the Federal Deposit Insurance Corp. made to depositors at failed banks. The Treasury report did not identify the banks but federal regulators seized the assets of California-based IndyMac Bank, the largest regulated thrift to fail in U.S. history.

The FDIC is expected to be successful in recovering much of its outlays for failed banks, in part by selling the assets of seized institutions. The FDIC has also raised the possibility that it will increase insurance premiums on healthy banks to cover the cost of what are expected to be rising bank failures as the current credit crisis unfolds.

Besides the payouts by the FDIC, government outlays were increased by the final bulk mailings of government stimulus payments in July. The July deficit also looked worse than the July 2007 deficit because last year's figure was artificially deflated by timing issues that shifted about $19 billion in normal outlays into the prior month. So far this year, the budget deficit totals $371.4 billion, more than double last year's deficit through the same time period of $157.4 billion.

More Budget deficit soars to $102.8 billion - Stocks & economy - MSNBC.com