Parky60 Loc: People's Republic of Illinois

Another sign of more inflation on its way. Parky60

The Biden administration ran yet another massive budget deficit in March.

Tax receipts were up last month compared to February, but even more so was spending. That led to a $236.46 billion budget shortfall, according to the latest Monthly Treasury Statement.

With another huge monthly deficit on the books, the budget shortfall for fiscal 2024 eclipsed $1 trillion ($1.06 trillion) just halfway through the fiscal year.

Federal tax receipts were healthy in March at $332.09 billion. That was a 6 percent increase over March 2023.

But President Biden and his minions blew through $568.55 billion last month. That was the highest spending total so far this year and inflated total spending for fiscal 2024 to $3.25 trillion.



Spending is up 3.3 percent compared to the half of fiscal 2023. This despite the (pretend) spending cuts and promises from the Biden administration that it would save “hundreds of billions” with the debt ceiling deal (aka the misnamed Fiscal Responsibility Act.)

This reveals the ugly t***h in Washington D.C. No matter what you hear about spending cuts, the federal government always finds new reasons to spend more and more money.

I should note that this problem isn't specific to Biden or Democrats in general. The Trump administration was running $1 trillion deficits before the p******c. In other words, Trump was generating Obamaesque deficits despite having what he claimed was the strongest economy in history.

Borrowing and spending is a bipartisan sport.

These massive monthly budget shortfalls are pushing the national debt higher at a dizzying pace. On December 29, the national debt eclipsed $34 trillion for the first time. When Congress effectively eliminated the debt ceiling on June 5, the national debt stood at a "mere" $31.46 trillion. As of April 16, the national debt stood at nearly $34.6 trillion.

According to the CBO, debt held by the public is projected to balloon from $26.2 trillion to $48.3 trillion by the end of 2034. That would represent 116 percent of GDP and would be the highest level on record.

The Interest Problem
Higher interest rates are creating an even bigger problem for Uncle Sam. With price inflation still running hot, it appears likely the Federal Reserve will put off interest rate cuts until later this year. But the federal government desperately needs interest rate cuts.

The ugly t***h is the federal government is going to have a hard time maintaining the pace of borrowing with rates this high. (And from a historical perspective, they aren't even all that high.)

The U.S. government spent $88.65 billion on interest expenses alone in March. This was more than the amount spent on national defense ($70 billion) and more than Medicare ($66 billion). The only spending category higher than interest expense was Social Security.

The government has shelled out $522.02 billion on interest payments so far in fiscal 2024. That's a 35.9 percent increase over the same period in fiscal 2023. Again, the only category with higher spending was Social Security.

Net interest expense, excluding intragovernmental t***sfers to trust funds, was $429 billion through the six months of the fiscal year, still nearly as much as the government spent on national defense ($433 billion).

To put this into a different perspective, the federal government is spending over 1/3 of its tax receipts on interest expense alone.

And interest expenses will only continue to climb.

Much of the debt currently on the books was financed at very low rates before the Federal Reserve started its hiking cycle. Every month, some of that super-low-yielding paper matures and has to be replaced by bonds yielding much higher rates.

The weighted average interest rate on the government’s outstanding Treasury securities rose to 3.28 percent as of the end of March. That compares with a weighted average rate of 2.58 percent in February 2023.

The only way out of this fiscal death spiral is significant spending cuts and/or major tax hikes. If you think that the former will happen, I have some beachfront property in New Mexico to sell you. And the latter is evidence of what Joe wants but will ultimately be unsuccessful.

Milosia2 Loc: Cleveland Ohio

Yep !
It looks like the rich aren’t paying their fair share Again !!!
Should we beat more out of the peasants ???
Spend less on tax breaks for rich people?
Or just take it out of Your Social Security check or
Maybe take it from Medicare ??????

Parky60 Loc: People's Republic of Illinois

You never fail to amuse with your gross ignorance.

BIRDMAN

🤪🤪🤪🤪🤪