PF Exclusive: Debt increase in FY2015 lowest in 14 years

Discussion in 'Budget & Taxes' started by Iriemon, Nov 13, 2015.

  1. OldManOnFire

    OldManOnFire Well-Known Member

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    Since all FICA monies go into the general fund today, all surplus FICA money each year that is not needed for SS payouts, is used to fund the general government, the actual deficit spending each year and the total annual debt do not take into consideration this borrowing. For every FICA dollar the US government takes in it trades for an interest-bearing bond which is redeemable at any time. Therefore, in every case in which there are surplus FICA monies used to fund the general government, the deficit spending and debt numbers are being understated! For example, if we think the annual debt increase was $500 billion, however, the government used $200 billion in FICA monies, the correct annual debt should be stated as $700 billion...
     
  2. Ndividual

    Ndividual Well-Known Member

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    Looking at my Federal debt history file, which is updated daily and begins with the Federal debt owed on January 1, 1790 of $71,060,508.50 it seems that somewhere around 1997 they began to break the debt into two categories, calling them "Debt held by the public" and "Intergovernmental Holdings" and it's my understanding that surplus FICA revenue collected is a component of the "Intergovernmental Holdings" which when combined with the "Debt held by the public" is the true total debt owed by our government which 'some' income earners who actually pay taxes are collectively seen responsible for creating.

    FICA revenue surplus should not be used in creating a budget as it only intensifies the demands by those who want more government assistance programs without any concern of the fact that we, our governments Federal, State and local, are each living well beyond their means.
     
  3. OldManOnFire

    OldManOnFire Well-Known Member

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    Whenever we use credit to buy stuff, or borrow FICA funds to fund general government, we are living beyond our CASH means. All of this credit spending drives up the economy, creates inflation, while our cash position remains sort of static. We are hell-bent on consuming ourselves into economic prosperity!

    Today we have IMO an abuse of credit buying to the point that between government debt spending and personal credit spending how do we even know how healthy the US economy might be? Credit spending is so out of control that today people buy according to how much their monthly credit bills might be; for example people will buy /lease a car because they believe they can afford the $300 monthly payment no matter that they are creating $30K in debt. And this is further illustrated today by how many people are leasing cars instead of buying them.

    Long gone is the idea of SAVING and buying when there's enough cash to buy...instant gratification and entitlement...
     
  4. Bluesguy

    Bluesguy Well-Known Member Donor

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    The government doesn't borrow FICA funds to "fund general government" as a matter of course. What does happen is that if there are surplus funds in the trust funds they have to be put somewhere. SS mostly operates on a cash in cash out basis breaking even but there have been periods when surplus funds are generated. Those funds have to be put somewhere and where they are put is in what is called the safest investment in the world US Treasury Bills, so yes then the government has those funds available to spend.

    Good system? No. But as long as this is the system we have where should those surplus funds be put. In and private market retirement system they are of course invested, some even in US T bills but also in the markets in order to generate returns which are used to pay benefits. Just hint at SS funds being invested in the open markets, in AAA investments even, and the uproar is deafening.
     
  5. lynnlynn

    lynnlynn New Member

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    How about this, since every year there is surpluses for both the Medicare fund and Social Security fund, perhaps they should lower the taxes taken from people earnings. Using those surpluses by replacing the cash with worthless treasury bills that are cashed using current tax payers money is wrong for so many obvious reasons.
    There is no reason why those surpluses could not have stayed in those accounts earning interest to be used to increase social security checks for the elderly or terminate the elderly from having to purchase or pay low premiums for coverage after age 65.
     
  6. Iriemon

    Iriemon Well-Known Member Past Donor

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    While top income tax rates were slashed, FICA taxes where raised during Reagan's presidency. FICA taxes are the taxes that working middle/lower class folks mostly pay.

    There have been calls to cut FICA taxes which were being overtaxed to the tune of a couple hundred billion a year. But the Republicans who controlled Congress will give massive tax cuts to billionaires, but aren't interested in cutting taxes the poorer folks pay.
     
  7. Bluesguy

    Bluesguy Well-Known Member Donor

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    Except the lower classes get them reimbursed through the EITC and then of course they get a direct benefit from their contributions a higher benefit as they actually make a return on their contributions while those at the top lose money.

    So you would move the capital gains rate back to the Clinton 29.1 where we collect half the revenues that we did under the Bush 15% rate?

    Why on earth would you do that?
     
  8. Bluesguy

    Bluesguy Well-Known Member Donor

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    As with any retirement system you can't operate it as a Ponzi scheme with those just entering paying those at the top. You need the reserves and for those to be invested earning a return to help pay the benefits being paid out.

    Earn interest from whom? Who would be paying interest on the money if it is just sitting in some "account" somewhere?
     
  9. Iriemon

    Iriemon Well-Known Member Past Donor

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    Only the poorest.

    The revenues were half after the Bush tax cut for equivalent periods of realizations.

    But no, we should do it like Reagan had it and make the cap gains tax the same as earned income.

    We should b/millionaires get a special low tax rate on their income? We should we incentivize speculative investment over earning and production? Hasn't our manufacturing sector taken enough of a hit?

    The 1% are now getting about 20% of the nation's income and have about 40% of the nation's wealth, double since before the Reagan "trickle down revolution. The bottom 90% are getting only 50%, down from 65%.

    Aren't the richest getting enough of the nation's income and wealth for you?

    Oh I forgot, for you, they're not.

    For some, more is never enough.
     
  10. Bluesguy

    Bluesguy Well-Known Member Donor

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    Nope into the middle class. And it is jot a general revenue tax is it so why do you misrepresent it as if it is? It is a retirement system isn't it? You pay into it for your future benefit.

    Yep business activity increases growth and expansion and almost tripled the realizations as a result revenues.

    Why would you want the lower revenues and less business activity and growth? And of course that was not a singular act nor his alone or are you not aware that the 1986 TRA was a very bipartisan deal. So if you support those rates then surely you support the lower of the top income tax rate to 28%?
    The "special rate" is they pay the highest rates on all income, earned and unearned so lets get rid if those "special rates" and make yohvhappg and have them page the same rates as the lower income groups. No special rate for anyone just a flat rate.

    Wealth and income are two seperate thongs and we don't tax wealth. The top 1% earns approximately 20% of income yet pay almost 40% of income taxes. The top 20% pay almost 80% of income taxes.The bottom 50% pay virtually no income taxes.

    If that js nkt fairbthen what would be?

    I'm for people earning as much ad they can in this fee country how about you? Why do you believe the purpose of the tax system is to regulate how much a citizen can legally earn?

    - - - Updated - - -

    Nope into the middle class. And it is jot a general revenue tax is it so why do you misrepresent it as if it is? It is a retirement system isn't it? You pay into it for your future benefit.

    Yep business activity increases growth and expansion and almost tripled the realizations as a result revenues.

    Why would you want the lower revenues and less business activity and growth? And of course that was not a singular act nor his alone or are you not aware that the 1986 TRA was a very bipartisan deal. So if you support those rates then surely you support the lower of the top income tax rate to 28%?
    The "special rate" is they pay the highest rates on all income, earned and unearned so lets get rid if those "special rates" and make yohvhappg and have them page the same rates as the lower income groups. No special rate for anyone just a flat rate.

    Wealth and income are two seperate thongs and we don't tax wealth. The top 1% earns approximately 20% of income yet pay almost 40% of income taxes. The top 20% pay almost 80% of income taxes.The bottom 50% pay virtually no income taxes.

    If that is not fair then what would be?

    I'm for people earning as much ad they can in this fee country how about you? Why do you believe the purpose of the tax system is to regulate how much a citizen can legally earn?
     
  11. OldManOnFire

    OldManOnFire Well-Known Member

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    https://www.ssa.gov/oact/STATS/table4a3.html

    Looks like about $2.8 trillion in the trust fund as of 2015. There is a surplus almost every year. This surplus is used to fund the general government...
     
  12. Bluesguy

    Bluesguy Well-Known Member Donor

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    And note the years when there was no surplus and how that surplus is declining as we type.

    What should be done with the surplus funds then. Where should those monies be placed under a mattress at the Treasury Department?
     
  13. Battle3

    Battle3 Well-Known Member

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    Investing SS in govt bonds would work if the government was not rolling over its debt. Its taking the social security surplus and spending it, and placing an IOU in the social security "lock box". When that IOU comes due, the govt borrows money to pay the SS IOU. In other words, the govt is just shuffling an ever larger number of IOU's around.

    And for years (well before obama), the govt has been eying all those private retirement funds and wanting to suck all those IRA's and 401k's into a government "retirement program" merged with social security. They are running out of money and want to take private pension funds to keep their Ponzi scheme rolling for a little while longer.
     
  14. Bluesguy

    Bluesguy Well-Known Member Donor

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    There is no SS "lock box" again if not US T bills then in what should the surplus funds be placed?

    I dont know of any but in all those years but certainly the current crop of leftist would love to get their hands on those private retirement accounts. To them its not fair that you saved and built wealth while your neighbor did not and has nothing upon which to retire. You're supposed to give him some of yours now.
     
  15. Battle3

    Battle3 Well-Known Member

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    True, the "lock box" is propaganda.

    Social security should not have any surplus, any surplus it received should result in reduced taxation in the following year.

    Ideally, social security would be a temporary safety net only, not a retirement program.
     
  16. Bluesguy

    Bluesguy Well-Known Member Donor

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    It desperately needs a surplus and one that is invested and making a return on that investment just like any retirement fund. That surplus gets over times of shortfalls in incoming revenue and interest or earnings on it help to fund benefits.

    Ideally whatever, it was never "designed" to be a temporary safety net, that is welfare. It was designed as the most basic retirement supplement for those who had nothing saved. Now you and I might agree that that is not the role of the government to run such a system, but that is what it was designed for.

    So the fact remains we have that system in place, surplus revenues are generated and have to be put somewhere, there is no mattress at the Treasury Department to shove them under.

    So where should those funds be placed other than US T bills?
     
  17. Iriemon

    Iriemon Well-Known Member Past Donor

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    Nope just the poorest. Most middle class families don't get the EITC. Those that do get lesser amounts that don't cover the FICA taxes paid.

    Prove it. The only thing that grew faster after the '97 cap gains tax cut were speculative investments in the stock bubble. Which crashed and then proveded less revenue.

    Why would you want to promote investment bubbles and cut tax revenues?

    The richest are the ones who have the vast bulk of investments and thus benefit from the special rates the most.

    The 1% pays about 22% of all federal taxes. Less when you include state taxes.

    About 50% they way Reagan had it for most of his tenure.

    Exactly my point.
     
  18. Bluesguy

    Bluesguy Well-Known Member Donor

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    Nope extends up into middle class and phases out. Why shouldn't people make their contributions into the future SS benefits which have nothing to do with general revenues for the Federal Government? Why do you continue to conflate things?
    No need to post the numbers again and the expansion was across the board it was a great economy and since ever stock that trades on the stockmarket is "speculative" you statement is specious.

    Tax revenues soared and you are the one bragging about the stockmarket growth the last 8 years why are now against stock market growth?

    It is not a special rate and they pay the highest rate on investment income in fact the lower incomes pay NO tax on investments. What's unfair about that?


    We're talking income taxes.

    So why do you want to raise cap gains tax rates to the rate the produce half the tax revenues?
     
  19. Ndividual

    Ndividual Well-Known Member

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    Update on the debt. (In US $, not apples or oranges)

    FY2016 Mo12 08/31/2016
    Public held debt $14,173,423,516,895.82
    Intergovernmental $5,400,021,197,040.97
    Total Public Debt $19,573,444,713,936.79
    Monthly change +$63,148,471,171.13
    Cumulative FY2016 +$1,422,827,047,452.46

    My figures are obtained from the Treasury, and as expected, they clearly show that the debt/deficit spending has NOT been turned around as suggested in the OP.


    Update to the OP data:

    FY END______TOTAL DEBT________DEBT CHANGE________8 YEAR AVERAGE CHANGE
    9/30/2016 19,573,444,713,936.79 1,422,840,436,186.16 1,193,589,977,128.04
    9/30/2015 18,150,604,277,750.63 326,532,897,016.81
    9/30/2014 17,824,071,380,733.82 1,085,887,854,036.50
    9/30/2013 16,738,183,526,697.32 671,942,119,311.43
    9/30/2012 16,066,241,407,385.89 1,275,901,078,828.74
    9/30/2011 14,790,340,328,557.15 1,228,717,297,665.36
    9/30/2010 13,561,623,030,891.79 1,651,794,027,380.04
    9/30/2009 11,909,829,003,511.75 1,885,104,106,599.26

    9/30/2008 10,024,724,896,912.49 1,017,071,524,650.01 543,818,335,878.20
    9/30/2007 9,007,653,372,262.48 500,679,473,047.25
    9/30/2006 8,506,973,899,215.23 574,264,237,491.73
    9/30/2005 7,932,709,661,723.50 553,656,965,393.18
    9/30/2004 7,379,052,696,330.32 595,821,633,586.70
    9/30/2003 6,783,231,062,743.62 554,995,097,146.46
    9/30/2002 6,228,235,965,597.16 420,772,553,397.10
    9/30/2001 5,807,463,412,200.06 133,285,202,313.20

    9/30/2000 5,674,178,209,886.86

    Except for the fact that it was not turned around.

    Except for the fact that while Social Security spending is fully funded it is not producing as large surpluses for government to borrow from.

    Let's hope whoever wins the 2016 election will recognize the fact that Federal spending needs to be massively slashed.
     
  20. Ndividual

    Ndividual Well-Known Member

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    Social Security shortfalls occurred in 1959, 1961, 1962, 1965, 1975, 1976, 1977, 1978, 1979, 1980, and 1981.
    In those years the accumulated surplus was used to make up the difference in the expenditures which left the Federal government to find other sources to borrow from to cover the other deficit spending. It is the other spending, not social security, that is creating our expanding debt, and unlike welfare assistance spending, by law social security benefit payments would be reduced if the incoming revenue and surplus were inadequate to cover the promised? benefits.
     
  21. Bluesguy

    Bluesguy Well-Known Member Donor

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    It was the Republican cutting of tax rates that produced the soaring tax revenues, after the Clinton tax rate increase slowed the growth of tax revenues, that balanced the budget in the late ninties and had us heading there in the mid 2000's with a final Republican deficit of a paltry $161B in in 2007. It was the Democrats who then increased spending 9% in 2008, only that low because Bush refused to let them go higher, and then cutting Bush out of the process increased spending 18% sending the deficit to that whopping $1,400B.

    And you supported those spending increases did you not, you even defend them now do you not?
     
  22. Iriemon

    Iriemon Well-Known Member Past Donor

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    Family of 4 with mediation income gets no EITC

    These are periods of equivalent capital gains realizations which prove that during equivalent time periods, tax revenues are down with lower cap gains tax rates.

    Year - Realized C/G - Tax rev.
    1996 $260.696B $66.396B [Cap gains tax rate 28%]
    2002 $268.615B $49.122B [Cap gains tax rate 20%]
    2009 $263.460B $36.686B [Cap gains tax rate 15%]
    http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Docid=161

    You are using periods where the stock market boomed, and capital gains realizations where higher because of that. You're unfairly comparing periods with realizations that are multiples higher. In 2007, realizations were 4x higher, but the CG tax was only 2x higher.

    You're not trying to argue that the capital gains tax cut causes greater stock market growth, are you? Prove it.

    If so, they've done a (*)(*)(*)(*)ty job since 1999.

    So much for that argument.

    Fueled a speculative bubble that crashed and along with it tax revenues.
    It's a special rate that is half the rate that working people pay and no FICA taxes.

    Another sweet deal for the richest. It's how guys like Romney and Buffet pay lower tax rates than their secretaries.

    No, you're cherry picking.

    I want to raise cap gain taxes because they produce twice the revenues. See above.
     
  23. Iriemon

    Iriemon Well-Known Member Past Donor

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    Not as much as it appeared.

    What we saw was that some of the debt that would have been accumulated in FY 2015 was held up because of the government funding holdup in Congress.

    When they finally got a budget, the funding taps were opened. So we saw the debt increase from $18.153B on Oct 30 2015 (about where it started the year) to 18.827B by Nov 30 2015, a $674 billion increase in just 1 month.

    The debt ended the year a $19.573, which was a $746 billion increase over the past 10 months.

    If we average out FY2015 and FY2016 we can an average increase of $874.5B per year.

    If you really cared about the debt, your focus would be on reducing the deficits.

    The government's revenues are still about 2 percentage points off their high in 2000, which equates to about $350 billion less revenues. Spending is higher than in 2000, but still lower than most years that Reagan was in office.

    With the interest added with debt accumulated since 2000 and retiring boomers, it isn't practical to return to 2000 spending levels, without major changes in government functions and programs.
     
  24. Iriemon

    Iriemon Well-Known Member Past Donor

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    You make this up all the time. Then I ask you to prove it you disappear.

    Falsehood.

    Bush inherited a +236 billion surplus and left with a $1.2 trillion deficit and the worst recession in 80 years.



    The truth is that the nearly 18 percent spike in spending in fiscal 2009 — for which the president is sometimes blamed entirely — was mostly due to appropriations and policies that were already in place when Obama took office. ... Since pictures can convey information more efficiently than words, we’ll sum up the official spending figures in this chart. It also reflects our finding that Obama increased fiscal 2009 spending by at most $203 billion, accounting for well under half the huge increase that year. ... So by our calculations, Obama can fairly be assigned responsibility for — at most — 5.8 percent of the $3.5 trillion that the federal government actually spent in fiscal 2009, which was 17.9 percent higher than fiscal 2008.

    http://www.factcheck.org/2012/06/obamas-spending-inferno-or-not/

    When Obama took the oath of office, the $789 billion bank bailout had already been approved. Federal spending on unemployment benefits, food stamps and Medicare was already surging to meet the dire unemployment crisis that was well underway. See the CBO’s January 2009 budget outlook.

    Obama is not responsible for that increase, though he is responsible (along with the Congress) for about $140 billion in extra spending in the 2009 fiscal year from the stimulus bill, from the expansion of the children’s health-care program and from other appropriations bills passed in the spring of 2009.


    http://www.marketwatch.com/story/obama-spending-binge-never-happened-2012-05-22?pagenumber=2

    Listening to a talk radio program yesterday, the host asserted that Obama tripled the budget deficit in his first year. This assertion is understandable, since the deficit jumped from about $450 billion in 2008 to $1.4 trillion in 2009. As this chart illustrates, with the Bush years in green, it appears as if Obama’s policies have led to an explosion of debt. But there is one rather important detail that makes a big difference. The chart is based on the assumption that the current administration should be blamed for the 2009 fiscal year. While this makes sense to a casual observer, it is largely untrue. The 2009 fiscal year began October 1, 2008, nearly four months before Obama took office. The budget for the entire fiscal year was largely set in place while Bush was in the White House.

    http://www.cato.org/blog/dont-blame-obama-bushs-2009-deficit

    Having said that, it is impossible to look at the chart and not to see a large ramp up in outlays under George W. Bush — the president who reversed the direction of federal outlays, which had been falling. Indeed, it is perfectly reasonable to argue that much of the responsibility for 2009’s 25.2 percent rests with President Bush, and not with President Obama; in January 2009, before President Obama took office, the CBO released its forecast that fiscal year 2009 would see outlays of 24.9 percent of GDP based on pre-Obama policies.

    http://www.forbes.com/sites/realspin/2012/09/03/yep-obamas-a-big-spender-just-like-his-predecessors/

    On Jan. 7, 2009, two weeks before Obama took office, the Congressional Budget Office reported that the deficit for fiscal year 2009 was projected to be $1.2 trillion.

    http://www.politifact.com/truth-o-m...obama-inherited-deficits-bush-administration/

    Of course, with the worst recession in 80 years Bush and the Republicans left us, we needed to spend more.
     
  25. Bluesguy

    Bluesguy Well-Known Member Donor

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    And the middle class is much broader than just those who make exactly the Miriam..


    When under Clinton's 29% were there equivilant realizations which are driven by economic activity and growth and noted how you post Clinton numbers from a grwoth period and the others during slowdown/recessions.

    Post the peaks under each rate then your numbers might have some credibility.

    What's wrong with an expanding economy and growth which the lower rares help to bring about

    Fueled growth, expansion, opportunity full employment and more taxpayers which it seems you oppose.

    There is nothing "special" about capgain rates and the lower income groups pay either nothing on such gains or very little. And those few who ONLY get income from such gains and so not contribute to Social Security do not collect Social Security, it s a contributory retirement system so what's your beef? Those at the top that do contribute to the systemand far more into it and get far less back, so what's your beef about it?

    A secretary that has to make over $300,000 to pay more and have to have posy tax accountants? Spare me please.

    Nope your conflating.

    Only when you compare the lower rates during recessions and higher rates during booms. You know cherry picking.
     

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