I do Larry Kudlow’s show whenever he asks, and while I am certainly not the
political wonk he is, I do keep track of the budget process. I want to see how the deficit is shrinking or growing, what changes to the tax code might be coming, and which sectors of the economy are getting a spending boost from Uncle Sam.
That’s a lot of stuff to watch — Fortunately, there’s a terrific set of charts today via the online WSJ: Crunching the Numbers (click each for larger graphics).
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Gainers and Losers:
A broader view of what’s growing and shrinking in Bush’s 2007 proposal, in budgetary authority
Sources: Office of Management and Budget, AP
*Includes miscellaneous, undistributed offsetting receipts
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Receipts and Outlays
A look at how the federal government is counting on bringing in revenue, and how it plans to spend it in fiscal 2007. All figures in billions unless noted.
Did you know that thee Estat Tax weas such a modest slice?
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Deficits & Taxes
By assuming that federal spending will shrink as a share of the
economy — after five years of increases — the White House projects
the federal budget deficit (left) to drop sharply over the decade.
Separately, with steady reductions in corporate taxes (right),
companies pay a decreasing portion of the taxes Washington collects.
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Defense Spending and Health Care
The president’s defense budget (left) includes billions of dollars
of spending to fight unconventional threats like insurgents but defers
the big decisions on countervailing cuts to major weapons systems that
most senior defense officials acknowledge will eventually be necessary.
Spending on health care (right) is projected to continue as a growing
part of the economy.
The problem with this chart is that I cannot see how Defense spending reverses that uptrend in a time of terrorism; That’s a dramatic shift that requires some major cold war era weapons systems getting cancelled — a politically unpopular move i n a mid-term election year.
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While the White House requests funding annually, the amounts
Congress appropriates don’t always match. Here’s how several projects
fared over the past few years.
*Program realigned to reflect new initiatives
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Source:
Bush Would Boost Defense, Security In Budget Plan
Social Programs Face Cuts In Proposal for Fiscal 2007; Worries Over Heating Bills
DEBORAH SOLOMON and JOHN D. MCKINNON
THE WALL STREET JOURNAL, February 7, 2006; Page A1
http://online.wsj.com/article/SB113923342926565990.html
Crunching the Numbers
http://online.wsj.com/documents/info-budget06-02.html
Bush’s Defense Budget Puts Off Cuts to Weapons
GREG JAFFE and JONATHAN KARP
THE WALL STREET JOURNAL, February 7, 2006; Page A17
http://online.wsj.com/article/SB113923422769866000.html
Your numbers on the defense budget look off. FY06 is estimated at total outlays of 512 billion and FY07 at 504.8, but that’s because the WH hasn’t projected the full cost of Iraq for ’07 and will seek a very large supplemental appropriation later.
Those are WSJ sourced data
Well today is a boring day so my boring posts increase. lol. I can’t believe we spend $27 billion a year on agriculture.
I come from a family of farmers and friends of farmers. I was not a member of FFA growing up but given the fact Barry is a citified boy, I bet he doesn’t even know what that is. My step dad has a 400 acre farm. The Feds pay him to NOT plant. Too much corn or soybeans? Pay them more to not plant. They get a price per acre. I can’t remember what it is but when it is millions of acres, it’s alot. Can you imagine a program where the Feds would say, ok, we are going to pay you to only work three days a week. You stay home the other two days and we are going to pay you. Our farming industry is so socialist it makes the French look like free marketeers. And now that much of farming is done by corporations and large conglomerates, it is simply another form of welfare in an area where those people could be refocusing their energy on other areas of the economy that would benefit.
$27 billion…………..over thirty years. Obviously not accounting for inflation or the sorts. That’s a cool trillion dollars of waste.
$500 billion for defense because the paranoia machine has been in overdrive for fifty years. McCarthy, Commies everywhere, bomb shelters. I’d guess the average over the last thirty years has been $200 billion for defense. Likely more. That’s six trillion dollars. Oh, but we needed to defend ourselves from the Commies.
The Energy Department was created by Carter to free us from foreign oil………thirty years ago. Well a trillion dollars later, we now have doubled our energy dependence on foreign energy. Hey, maybe in another trillion dollars we’ll be totally dependent. Gotta shoot for best practices.
Bush tells Kerry in the debate that Americans don’t want the Feds to run their healthcare system. Well, the biggest health care provider in the US is the Fed. I guess that was secret code for cancelling Medicare? Could we just blow up all healthcare, create a free marekt system that is based on standards set by the Feds, make very basic coverage a right for all Americans and dump Medicare?
We piss away so much money. None of these politicians could ever run a business. They are clueless and mindless. For God’s sake they are our leaders? People carp on Greenspan? He’s a knight in shining armor comparatively.
Calling Kudlow a ‘wonk’ is extremely generous. He’s an advocate, and a consistently blatantly dishonest one at that.
Wow. I’m surprised at the relative proportions of corporate vs. income/payroll taxes. Now another interesting tidbit would be a subdivision of individual income taxes in earned income/other.
Wait till long term rates move higher and the largest part of the budget is the foolish spending of debt from the past.
State of the Union, Budget and Our Educational Framework
Maya Cole:So the bottom line is that we shouldn’t expect much from the federal government. The dilemma for the Board and the community is to find out what our priorities will be for the coming years in Madison. Although we…
27 billion on agriculture. What a horrible act. A previous post stated his family receives money not to farm their 400 acres. I happen to farm, and I will let you know 400 acres is a large garden! Here is a thought, maybe one day we can lessen our dependence on foreign oil via agriculture (soybeans, corn, etc.). On the other hand, let’s scratch farming, and we will import these future sources of fuel consumption as well. Also, what is the percentage of acres in cultivation owned by corporations?
State of the Union, Budget and Our Educational Framework
Maya Cole:So the bottom line is that we shouldn’t expect much from the federal government. The dilemma for the Board and the community is to find out what our priorities will be for the coming years in Madison. Although we…
Where’s the income from the war bonds? What? We don’t have any? And we’re spending that much on defense? No wonder we’re screwed, huh?
Handouts to farmers won’t solve our problem with foreign oil. Farming is a huge welfare recipient. But hear them squeal when someone talks about cutting them. It’s their cocaine. Handouts to any industry has never solved any problems. What is usually leads to is more handouts because it keeps industry from addressing fundamental structural problems. There is way too much supply. That is why grain rots in government stock piles and the government gives away blocks of cheese to the poor. Nor has handouts to individuals unless it is helpful to retrain, re-educate or temporarily help people get back on their feet.
Btw, biofuels such as corn and soy require significant energy in the form of petrol to make and they must be cut with petrol. ie, Other than making someone feel good, they won’t help us at all. Or at least that is what I read from a chemical engineering article. Sugar cane and some other grass the Prez talked about don’t have those limitations. That is why Brazil uses sugar cane even though they are one of the world’s largest producers of other grains. Not that any of that matters because the point is farmers should not be getting welfare to perpetuate oversupply. Farming is big business and large farms are not the “ma, pa, apple pie” we’d like to believe. Farms with tens of thousands of acres are owned by business barons, millionares, conglomerates and companies. Do those people deserve welfare? Just like the largest meat producers are now companies such as pilgrim’s pride and tyson.
And, yes 400 acres is a large garden compared to millionare barons. But, it’s a garden half the size of Central Park….so maybe we could get Manhattan land prices. lol.
Well, duh. They’re lying. They always do.
Note that $884 billion for Medicare, Social Security and “retirement receipts” is listed as revenue!
Since 1969 the Federal government has been using this accounting method, which cannot be used by the private sector. Imagine if GM or IBM counted their employees retirement contributions as revenue.
It is not revenue, but monies that should be put into “trust” for retirees. The Medicare and Social Security trust funds consist of IOU’s from the Federal govermnet that cannot possibly be paid out unless we fundamentally change our society.
We will be paying a big price for this in future years.
Erik,
Your post brings some points to mind that make me laugh. You know, you might do a search on Google and see if you can drum up some links to Gerstner’s draining of a temporarily overfunded pension to quarterly results which resulted in IBM meeting earnings estimates something like 25 quarters in a row. Not too many quarters where it wasn’t close to right on the dime. And well within his rights of the regulatory world….at that time.
So, it wasnt’ counted as revenue but it was counted as profit……until IBM liquidated it’s defined benefit pension plan. How much did Gerstner and his cronies make while screwing hundreds of thousands of employees? I believe it was close to $800 million just for him…and a massive retirement package. Long live the great American dream: screw your fellow man.
Plenty of funny business to go around. You are right. Uncle Sammy is the biggest clown of all.
Jay:
There are several problems with this budget as I see it. First, not enough funding is allocated to homeland security. More importantly, the revenue and expenditure wheels disguise the size of the annual budget deficit. The larger concern is the debt service of the burgeoning federal debt as it continues to accumulate these budget deficits. It appears that federal revenues will be shrinking as a result of the demographics and the tax cuts for the wealthy during years in which more and more revenue will be needed to service the national debt. Will this result in raising taxes? If so, can our economy sustain a raise in taxes without being thrown into a tail spin? These economic tailspins can be disastrous in that they tend to further erode the tax base, resulting in still further hikes to the tax rates. So the larger question is, how will this play out in the year 2012, when baby-boomers start retiring, more high-value jobs get off-shored because there are fewer young Americans qualified to hold such jobs and the tax cuts for the wealthy are in place?