Is the deficit getting worse or better? Or does it matter it anymore

As usual, government spending goes up in an election year, so the deficit goes up. But it's not nearly as bad as the record $1.4 trillion deficit. But considering the zoom in GDP in the last few years, the deficit as a GDP% had dropped even faster.

Prior to 2001 the worst deficit was in dollars was in 1992 for -$290,321 ($290 billion)
Surplus or Deficit (–)
2001 $128,236
2002 -$157,758
2003 -$377,585
2004 -$412,727
2005 -$318,346
2006 -$248,181
2007 -$160,701
2008 -$458,553
2009 -$1,412,688
2010 -$1,294,373
2011 -$1,299,590
2012 -$1,086,963
2013 -$679,544
2014 -$484,627
2015 -$438,406
2016 -$615,805

Prior to 2001 the worst deficit in GDP % was in 1983 at -5.9% GDP. Of course the GDP is 5X larger today than it was in 1983. But in 2015 the deficit was 2.5% of GDP (the median post 1946 deficit has been 2.1%).

2001 +1.2%
2002 -1.5%
2003 -3.3%
2004 -3.4%
2005 -2.5%
2006 -1.8%
2007 -1.1%
2008 -3.1%
2009 -9.8%
2010 -8.7%
2011 -8.5%
2012 -6.8%
2013 -4.1%
2014 -2.8%
2015 -2.5%
2016 -3.3%

The "it doesn't matter anymore" theory is that the debt is about the same as the GDP that any attempt to restore interest rates to historical levels will produce a gargantuan outlay for payments.

Its a gargantuan outlay to issue bonds to "pay" the debt and its a gargantuan outlay to actually pay the debt.

A "run" on a bank can be due to economics or rumors or conspiracy; but is the USA too big to fail?

Quote: Pacomartin

The "it doesn't matter anymore" theory is that the debt is about the same as the GDP that any attempt to restore interest rates to historical levels will produce a gargantuan outlay for payments.

It makes me wonder why we are not locking up today's low rates. At some point the Feds cannot control the rate on Treasuries. If President Trump taps me for Secretary of Treasury my first meeting with him will be about issuing bonds with a > 30 year term. We need to keep a robust market for the 30 as so much else is tied to it's rate in the broad markets. But why not a 50 or 100 year? Even a USA version of CONSOL with no maturity? With rates below 3% there may be no better time.

Heading to $20 trillion in debt so each 1% is $200 billion. $667 per person in the USA. Double that to account for children, retired, and other non-productive folks. Maybe more than double when you take out government workers who effectively do not produce wealth to pay it in the end.

We also may still have a "hole" in 30 year maturities from when they were not issued in the late-1990s. I'm not sure how big an issue that will be on rollover in another 10 years or so.

Earlier today, a guy called into to Rush Limbaugh's program complaining about Trump's reckless deficit spending, and suggested that a fiscal conservative ought to challenge Trump in the GOP primaries. Rush let him in on a little secret: fiscal conservatism doesn't actually exist, the rhetoric is all a con.

Here's the transcript...

Quote: RushLimbaugh.com

CALLER: Republicans can nominate a young, potentially two-term president, one that believes in fiscal conservatism. We’re gonna have… In 2019, there’s gonna be a $1 trillion deficit. Trump doesn’t really care about that. He’s not really a fiscal conservative. We have to acknowledge that Trump has been cruelly used.

RUSH: Nobody is a fiscal conservative anymore. All this talk about concern for the deficit and the budget has been bogus for as long as it’s been around.

CALLER: That’s a difficult one. That’s a difficult one. And you’re right, that is true, that Republicans in Congress love spending taxpayer money almost as much as Democrats do. But it’s not just fiscal conservatism. You can get other characteristics. And the point is, you need to acknowledge that what has happened to Trump would try lesser men. It’s not fair, but that doesn’t mean that we owe him a reelection.

The rhetoric was a scam, the Tea Party was a scam, and Trump's fiscal responsibility promises were a scam. But sshh... don't tell the gullible GOP voters, because those marks will fall for anything and there's money to be made at their expense.

Quote: reno

Earlier today, a guy called into to Rush Limbaugh's program complaining about Trump's reckless deficit spending, and suggested that a fiscal conservative ought to challenge Trump in the GOP primaries. Rush let him in on a little secret: fiscal conservatism doesn't actually exist, the rhetoric is all a con.

Here's the transcript...

Quote: RushLimbaugh.com

CALLER: Republicans can nominate a young, potentially two-term president, one that believes in fiscal conservatism. We’re gonna have… In 2019, there’s gonna be a $1 trillion deficit. Trump doesn’t really care about that. He’s not really a fiscal conservative. We have to acknowledge that Trump has been cruelly used.

RUSH: Nobody is a fiscal conservative anymore. All this talk about concern for the deficit and the budget has been bogus for as long as it’s been around.

CALLER: That’s a difficult one. That’s a difficult one. And you’re right, that is true, that Republicans in Congress love spending taxpayer money almost as much as Democrats do. But it’s not just fiscal conservatism. You can get other characteristics. And the point is, you need to acknowledge that what has happened to Trump would try lesser men. It’s not fair, but that doesn’t mean that we owe him a reelection.

The rhetoric was a scam, the Tea Party was a scam, and Trump's fiscal responsibility promises were a scam. But sshh... don't tell the gullible GOP voters, because those marks will fall for anything and there's money to be made at their expense.

This is why I am no longer a republican

According to the US Commerce Department, federal government spending increase 7.9 percent in the second quarter of 2019.

Now that Trump is in office, we don't need the Tea Party anymore.

Quote: reno

According to the US Commerce Department, federal government spending increase 7.9 percent in the second quarter of 2019.

Now that Trump is in office, we don't need the Tea Party anymore.

GOP would be happy to cut spending. But propose anything and you get commercials of old ladies being pushed off cliffs and the media lapping it up and amplifying it.

At this point all you can do is enjoy and wait for the collapse. It is coming. When it hits you will see 30-40% of the population destitute. Chinese will take over and ask, "So, how was that free college and free health care? Now get back to sweeping up my office!"

Looper movie, Kansas City of future run by mafia


Looper movie, Shanghai of future is a utopia

I saw a The Onion style joke headline that said, basically, that the Republicans promised to start caring about spending and the deficit again as soon as Democrats were back in power.

Quote: AZDuffman

GOP would be happy to cut spending.

I think if the Tea Party was out there holding massive rallies & protests specifically targeting GOP politicians, then the GOP would acquiesce to the pressure and cut spending.

When the Tea Party marched on Washington in September 2009, the rally drew crowds of over 75,000. But the Tea Party is totally silent now that Trump is in power. Republican politicians know that right-leaning voters will never vote for Dems, so they have no incentive to listen to their own voters.