I never said that all accounting principles are the same. But the concept that borrowing money is not revenues/receipts and that running a surplus/profit does not mean that total debt decreased is the same. A profit/surplus or deficit/loss is not measured by whether the debt/liabilities increased or decreased. No, no, no. You are confusing accrual accounting and accounting for debt. The main difference between accrual and cash basis accounting is the timing of when revenue and expenses are recognized. The cash method is most used by small businesses and for personal finances. The cash method accounts for revenue only when the money is received and for expenses only when the money is paid out. On the other hand, the accrual method accounts for revenue when it is earned and expenses goods and services when they are incurred. The revenue is recorded even if cash has not been recieved or if expenses have been incurred but no cash has been paid. Accrual accounting is the most common method used by businesses. http://www.investopedia.com/ask/answers/09/accrual-accounting.asp The difference is the timing of when receipts or expenses are booked, but whether you use cash or accrual accounting, borrowing would never be booked as revenues. If you start with a company and do nothing more than borrow $10,000; you have $10k in assets (cash) and $10k liabilities (note payable), but you would absolutely not say that you have $10,000 in revenues (and with no expenses, therefore $10,000 in "profits". Unless you sold something, you would have -0- in revenues and -0- in profits. Same thing if pay down the loan. Paying down the principle is not an "expense". This is the same under accrual or cash accounting. If you borrow money as in your example, it would show up on the cash flow statement as a positive cash flow, but it is not revenue. Wrong on both counts. 1) The debt shows up on the balance sheet as a liability; and will show up on the cash flow statement if the proceeds were acquired in that time frame. 2) Paying down principle is never an expense. Interest can be an expense. The amount borrowed is not a revenue nor is it an expense. You are confusing your own ignorance of basic accounting with the Govt playing games. I recommend you consider sources more reliable than a RW computer programmer with no background in accounting or economics if you want accurate information.
You did put some accurate references, but you did not read them and understand them. No matter what form of accrual accounting you use, the bottom line is that the borrowed money shows up on the "plus" side and the obligation to pay back the borrowed money shows up on the "negative" side. If you borrow $10,000 and the payment is $11,000, then the bottom line is a negative $1,000 - you have a deficit. You are in over your head, you have the correct quotes and references which proves my point that the govt is playing games by using cash accounting, its just going right past you.
I've certainly never claimed that the Govt doesn't have to pay back what it borrows. That doesn't even make sense, and demonstrates your hopeless ignorance of basic accounting and economics. No wonder you feel so comfortable with the RW computer programmer. LOL
As usual, you have run out of arguments. The simple fact remains that there was no surplus as the Treasury numbers clearly show.
When did the Government become a "for-profit corporation"? Even if it were, though, how would any of it's outstanding debt it repurchased be reflected on it's balance sheet? Well, first off, your numbers are a bit off because you start at the end of FY98 instead of FY97, so they don't incorporate the FY98 surplus, but they essentially say the same thing my numbers did. I'd like to hear your take on why there is a discrepancy between the decrease in the debt held by the public and the increase in total debt... how do you account for this? Show me the money.
That's not necessarily true - while the beneficiary conditions are subject to change, the Government does owe the SS Trust fund the nonmarketable debt holdings it's annual surpluses have accrued, and so it is obligated to service this debt.
Sorry YOU are confused. Obama hasn't got US back to where Clinton had US 20% of GDP like ECONOMISTS measure it. It was near 20% under Carter too.. Today? less than 18%. THAT'S not record revenues
Dubya's last F/Y deficit January 08, 2009 CBO Projects $1.2 Trillion Deficit for 2009 http://www.memphisdailynews.com/editorial/Article.aspx?id=40264 NOW PLEASE give me POLICY Obama/Dems passed that caused the deficits??? lol - - - Updated - - - Please, PRETTY please give me the POLICY or LAWS the Dems passed that did that?
That is true, but that obligation is a debt and it is visible on the books as part of the total debt of the US.
Non-Partisan Congressional Tax Report Debunks Core Conservative Economic Theory The conclusion? Lowering the tax rates on the wealthy and top earners in America do not appear to have any impact on the nations economic growth. This paragraph from the report says it all The reduction in the top tax rates appears to be uncorrelated with saving, investment and productivity growth. The top tax rates appear to have little or no relation to the size of the economic pie. However, the top tax rate reductions appear to be associated with the increasing concentration of income at the top of the income distribution. http://www.forbes.com/sites/rickung...rvative-economic-theory-gop-suppresses-study/ (Re-)Introducing: The American School of Economics When the United States became independent from Britain it also rebelled against the British System of economics, characterized by Adam Smith, in favor of the American School based on protectionism and infrastructure and prospered under this system for almost 200 years to become the wealthiest nation in the world. Unrestrained free trade resurfaced in the early 1900s culminating in the Great Depression and again in the 1970s culminating in the current Economic Meltdown. Closely related to mercantilism, it can be seen as contrary to classical economics. It consisted of these three core policies: protecting industry through selective high tariffs (especially 18611932) and through subsidies (especially 193270) government investments in infrastructure creating targeted internal improvements (especially in transportation) a national bank with policies that promote the growth of productive enterprises rather than speculation. It is a capitalist economic school based on the Hamiltonian economic program. The American School of capitalism was intended to allow the United States to become economically independent and nationally self-sufficient. Frank Bourgin's 1989 study of the Constitutional Convention shows that direct government involvement in the economy was intended by the Founders. The goal, most forcefully articulated by Hamilton, was to ensure that dearly won political independence was not lost by being economically and financially dependent on the powers and princes of Europe. The creation of a strong central government able to promote science, invention, industry and commerce, was seen as an essential means of promoting the general welfare and making the economy of the United States strong enough for them to determine their own destiny. http://en.wikipedia.org/wiki/American_School_(economics)#Origins
"The change in the debt equals the budget surplus/deficit. Everyone knows that" BZZ wrong. Budget deficit/surpluses are related to YEARLY revenues versus YEARLY expenses. Stiener's bullsh*t meme aside, debt ISN'T equal to that....The US had 4 straight surpluses under BJ Bill (3 AFTER he vetoed the GOP' $792 BILLION tax cut) , yet debt increased!
Q: During the Clinton administration was the federal budget balanced? Was the federal deficit erased? A: Yes to both questions, whether you count Social Security or not. This chart, based on historical figures from the nonpartisan Congressional Budget Office, shows the total deficit or surplus for each fiscal year from 1990 through 2006. http://www.factcheck.org/2008/02/the-budget-and-deficit-under-clinton/
" The clause states that the United States Congress shall have power "To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes."
This is based on an annual document called the "Financial Report of the U.S. Government," which reports what the governments books would look like if kept on an accrual basis like those of most corporations, rather than the cash basis that the government has always used. The principal difference is that under accrual accounting the government would book immediately the costs of promises made to pay future benefits to government workers and Social Security and Medicare beneficiaries. But even under accrual accounting, the annual reports showed surpluses of $69.2 billion in fiscal 1998, $76.9 billion in fiscal 1999, and $46 billion for fiscal year 2000. So even if the government had been using that form of accounting the deficit would have been erased for those three years. http://www.factcheck.org/2008/02/the-budget-and-deficit-under-clinton/
Absolutely! And so long as the Government's budget remains balanced (as in Clinton's second term), would you agree that this extra total debt would have the effect of reducing the debt held by the public as opposed to being used to finance deficit spending?
And furthermore, if the deficit was so important to the economy then why didn't the GOP have the balls to tell the nation when Obama came into office that the remedy to the quasi-depression was to cut 1.7 trillion from the budget? Then you could have explained to the nation why all SS funds had been dropped. Or the entire military could have been dropped. Or all Medicare payments cut or every Medicaid payment. Or the entire Judiciary, Treasury, Department of Interior, HHS, Homeland Security, Dept of Ag, Energy, Transportation cut to zero. Maybe you wanted us to stop funding Congress, the Executive, hell, just have no government at all. Hundreds of thousands out of work plus millions of contractors, suppliers, vendors, consultants, hell just put everyone out of work. Yes, you could have balanced the budget and avoided your dreaded deficit quite simply, just cut the daylights out of government and you would have what you wanted. But no. If you want to play ball, get on the field. But they have no balls. They are just children trying to pretend to be adults. Like the kids who are caught by their parents in the middle of breaking the prize family heirloom into pieces, they just look up and say " wasn't me, no dad, wasn't me". We cannot function when so many are so irresponsible. It it time to grow up my connie friends.
The govt is not a for-profit corporation, that's not the point. The point was that several claimed that accrual was used by corporations because they could misstate their finances, which is incorrect - they use accrual because that is required by law, and accrual is more accurate for most corporations as any accountant will tell you. There was no surplus in FY1998. Pick your year, it does not matter, all years will show a deficit. The debt held by the public decreased in some of Clintons years because funds were taken from other government programs and applied to "on budget" programs. The govt borrowed from itself from "off budget" items, increasing the intragovt debt, so it could lower the on-budget debt and claim there was a surplus. Intragovt debt is still debt, it must still be repaid. Total debt is the true measure, not just debt held by the public.
You must have skipped this entire thread and jumped into it in the middle. Clinton had a "surplus" because the so-called federal budget is not complete, there are multiple items handled off-budget. You have to look at the unified budget to get the true picture. The difference in annual expenses and annual revenue adds/subtracts to the debt. Duh. And as you wrote, debt increased every year that Clinton claims a surplus - think about that, the federal debt increased yet some claim there was a surplus? Come on, put on the thinking cap....... - - - Updated - - - Read the thread.
Wow, is that wrong. But first, your link has this: "A deficit occurs when the government takes in less money than it spends in a given year. The debt is the total amount the government owes at any given time. So the debt goes up in any given year by the amount of the deficit, or it decreases by the amount of any surplus." The link conveniently then jumps to talking about the debt to the public rather than the true total debt, but then the link is politically biased. The total debt increased, even your link admits that an increase in debt means there was an annual deficit. The only way to show a surplus is to use a subset of the true federal budget. That's lying, which the govt is very good at doing.
That is false, as you know. The total debt decreased by $114 billion in 2000. But i know you'll go with the RW computer programs with no background in accounting or economics, regardless of what US Treasury Department, and the Government Accountability Office, and the bi-partisan Congressional Budget Office, and the Office of Management and Budget, and the Federal Budget Glossary, and Nationalpriorities.org, and the Tax Policy Center, and the US Debt Clock, and usgovinfo.about.com, and Fox News, and New Republic Town Hall, and Free Republic. and The Blaze, and CNS News, and Cato, and American Spectator, and the Washington Times, and every other source that is not a complete nutjob says. You know you're a RW real nut job when you take positions so incredible, so bizarre, and so obviously flaky, that even RW propaganda sources like Fox News, the Blaz, and the Washington Times would be ashamed to touch it.
Not sure what you are asking. Do you mean that the debt incurred from borrowing from the SS trust fund in any given year would have the effect of reducing the amount of the debt held by the public? Yes, that is generally true, because presumably if the money was not borrowed from the SS trust fund it would be borrowed from the public.
