November 13, 2012

Year-Over-Year Deficit Worsens in October, and the Problem Is Spending, Not Receipts

The government’s October 2012 Monthly Treasury Statement was released at 2 p.m. It tells us that the government took in $184 billion ($21 billion more than last year) while spending $304 billion ($43 billion more), leaving a $120 billion deficit. That’s 22% higher than the October 2011 shortfall of $98.5 billion.

The early report from the Associated Press’s Martin Crustinger predictably tells us that discussions over changing this ongoing situation and addressing the “fiscal cliff” involve how “to prevent tax increases and deep spending cuts from kicking in Jan. 1.” “Deep”? October 2012 spending annualizes out to $3.65 trillion, which if continued, as seen in comparison to figures for the past five years which follow, would be an all-time record.

Here’s the early AP report (produced in full for future reference, fair use and discussion purposes):

APonOct2012deficit

If Crutsinger and the AP follow previous form, they won’t mention the level of spending, but will highlight that collections increased.

As to the historic level of spending, here’s a table the Wall Street Journal produced to support a Monday editorial:

FedFiscalData2007to2012
As seen, spending was less than $3 trillion in 2008. Annualized, October 2012 spending represents a 22% increase from that year. As the Journal’s editorial noted: “The ‘emergency’ spending of the stimulus has now become permanent, as we predicted it would.”

Meanwhile, if form holds, tax receipts might actually return to a level last seen in 2007 if Congress decides to leave current tax rates as they are instead of letting the “fiscal cliff” tax hikes take effect.

Yet the press and Democrats (basically one and the same) call any reductions which threaten to reduce the new artificial spending baseline “deep” cuts. No, they’re not. They would be part of a return to sustainable sanity.

Cross-posted at NewsBusters.org.

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4 Comments

  1. At least for October, revenues were ahead of 2007 rates (in current dollars). However, Obama wants an effective top rate of 50%.

    Comment by steveegg — November 13, 2012 @ 5:10 pm

  2. Yet the press and Democrats (basically one and the same) call any reductions which threaten to reduce the new artificial spending baseline “deep” cuts. No, they’re not. They would be part of a return to sustainable sanity.

    It’s all a sales gimmick to the base and the moochers who voted for Obama. The GOP will always take the fall for any reduction, not matter how much Obama has larded up the spending in the first place. The MSM is still selling the idea of a recession if the GOP doesn’t agree with the Dems. Never mind we are already in a recession. In fact I saw one person selling the idea that a pre-recession will be caused due to wrangling over the Fiscal Cliff compromises before Jan 1, 2013. Watch for the MSM to unexpectedly discover the economy is now in a recession but blame the GOP for foot dragging on the issue and from causing uncertainty.

    Comment by dscott — November 13, 2012 @ 5:48 pm

  3. [...] Year-Over-Year Deficit Worsens in October, and the Problem Is Spending, Not Receipts [...]

    Pingback by Year-Over-Year Deficit Worsens in October, and the Problem Is Spending, Not Receipts | PERSUASION IN INK — November 14, 2012 @ 1:01 pm

  4. [...] Monthly Treasury Statement (I did a review of his initial take yesterday [at NewsBusters; at BizzyBlog]). The good news is that Crutsinger, unlike in most months during the past several years I have [...]

    Pingback by BizzyBlog — November 14, 2012 @ 4:12 pm

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