Budget deficit triples to $1.4 trillion, setting new record.

[I AM NOT THAT GUY 5,715]

US budget deficit touches $1.4 trn: represents 9.9% of GDP

The US federal budget deficit has ballooned to a staggering $1.4 trillion, the highest since World War II, for the fiscal year 2009 as massive government spending and lower revenues widened the gap.

Moreover, the deficit represents 9.9 per cent of the national GDP.

According to the Congressional Budget Office (CBO), the budget deficit was about $1.4 trillion for the fiscal year ended September 30, which is $950 billion greater than the shortfall recorded in 2008.

"The 2009 deficit was equal to 9.9 per cent of gross domestic product (GDP), up from 3.2 per cent in 2008, and was the highest shortfall — relative to the size of the economy — since 1945," the CBO said in a statement yesterday.

Earlier, the deficit was projected to hit $1.6 trillion in the fiscal year 2009.

The staggering shortfall between government revenues and expenditure was primarily on account of the huge Troubled Asset Relief Program (TARP) and the efforts to shore up the fortunes of beleaguered mortgage lenders Fannie Mae and Freddie Mac.

As part of initiatives to bolster the ailing financial system, the US pumped in billions of dollars into banking entities through TARP. In addition, the government shelled out nearly $200 billion to rescue Fannie Mae and Freddie Mac.

In September alone, the federal government recorded a deficit of $31 billion, where it was a surplus of $42 billion in the same period last year.

http://www.business-standard.com/india/new...-99gdp/75468/on

[mawilson 2,133]

$1.4 trillion just this year?

Worry not - the new health care plan will reduce it by $80 billion in 10 years!

[Mr. Big Dog 10,747]

Interesting calculation here - the budget deficit triples to 1.4 trillion. Hence, we're saying that the deficit was 1/3 of said 1.4 trillion last FY, yes? That would be roughly 466 billion.

Now, the federal debt outstanding on 9/30/07 was 9 trillion dollars. On 9/30/08 - one year later after having run a 466 billion deficit - the outstanding debt should be 9.47 trillion dollars, right? Oddly, the outstanding debt on the latter date was 10 trillion dollars suggesting that that feds had a trillion dollars worth of red ink during the previous FY. Just saying...

http://www.treasurydirect.gov/govt/reports...debt_histo5.htm

[Joseph & Ana 0]

Interesting calculation here - the budget deficit triples to 1.4 trillion. Hence, we're saying that the deficit was 1/3 of said 1.4 trillion last FY, yes? That would be roughly 466 billion.

Now, the federal debt outstanding on 9/30/07 was 9 trillion dollars. On 9/30/08 - one year later after having run a 466 billion deficit - the outstanding debt should be 9.47 trillion dollars, right? Oddly, the outstanding debt on the latter date was 10 trillion dollars suggesting that that feds had a trillion dollars worth of red ink during the previous FY. Just saying...

http://www.treasurydirect.gov/govt/reports...debt_histo5.htm

I don't know that raising the debt ceiling equates that the number is actual (yet).

[mawilson 2,133]

Interesting calculation here - the budget deficit triples to 1.4 trillion. Hence, we're saying that the deficit was 1/3 of said 1.4 trillion last FY, yes? That would be roughly 466 billion.

Now, the federal debt outstanding on 9/30/07 was 9 trillion dollars. On 9/30/08 - one year later after having run a 466 billion deficit - the outstanding debt should be 9.47 trillion dollars, right? Oddly, the outstanding debt on the latter date was 10 trillion dollars suggesting that that feds had a trillion dollars worth of red ink during the previous FY. Just saying...

http://www.treasurydirect.gov/govt/reports...debt_histo5.htm

The previous administration spent a lot of money off-budget, but two wrongs don't make a right.

[Mr. Big Dog 10,747]

Interesting calculation here - the budget deficit triples to 1.4 trillion. Hence, we're saying that the deficit was 1/3 of said 1.4 trillion last FY, yes? That would be roughly 466 billion.

Now, the federal debt outstanding on 9/30/07 was 9 trillion dollars. On 9/30/08 - one year later after having run a 466 billion deficit - the outstanding debt should be 9.47 trillion dollars, right? Oddly, the outstanding debt on the latter date was 10 trillion dollars suggesting that that feds had a trillion dollars worth of red ink during the previous FY. Just saying...

http://www.treasurydirect.gov/govt/reports...debt_histo5.htm

The previous administration spent a lot of money off-budget, but two wrongs don't make a right.

I know and I agree. Just don't like folks getting confused with them numbers or taking headlines too seriously. The claim that the defict tripled just doesn't hold water.

[one...two...tree 2,762]

Interesting calculation here - the budget deficit triples to 1.4 trillion. Hence, we're saying that the deficit was 1/3 of said 1.4 trillion last FY, yes? That would be roughly 466 billion.

Now, the federal debt outstanding on 9/30/07 was 9 trillion dollars. On 9/30/08 - one year later after having run a 466 billion deficit - the outstanding debt should be 9.47 trillion dollars, right? Oddly, the outstanding debt on the latter date was 10 trillion dollars suggesting that that feds had a trillion dollars worth of red ink during the previous FY. Just saying...

http://www.treasurydirect.gov/govt/reports...debt_histo5.htm

The previous administration spent a lot of money off-budget, but two wrongs don't make a right.

Some refuse to acknowledge or even understand how the stimulus has worked.

[mawilson 2,133]

Some refuse to acknowledge or even understand how the stimulus has worked.

It has worked mostly *psychologically* up to this point (shoring up confidence), as only about 15%

of the stimulus money has been spent so far.

I think we have yet to see the results. We will definitely see *something* - when you throw

trillions of dollars at a problem, some of it will stick.

[Mr. Big Dog 10,747]

We will definitely see *something* - when you throw trillions of dollars at a problem, some of it will stick.

Yep, just as the strategy against health care reform - throw enough misinformation out there and some of it will stick.

[Joseph & Ana 0]

Interesting calculation here - the budget deficit triples to 1.4 trillion. Hence, we're saying that the deficit was 1/3 of said 1.4 trillion last FY, yes? That would be roughly 466 billion.

Now, the federal debt outstanding on 9/30/07 was 9 trillion dollars. On 9/30/08 - one year later after having run a 466 billion deficit - the outstanding debt should be 9.47 trillion dollars, right? Oddly, the outstanding debt on the latter date was 10 trillion dollars suggesting that that feds had a trillion dollars worth of red ink during the previous FY. Just saying...

http://www.treasurydirect.gov/govt/reports...debt_histo5.htm

The previous administration spent a lot of money off-budget, but two wrongs don't make a right.

Some refuse to acknowledge or even understand how the stimulus has worked.

And some like you continue to use it as an unsubstantiated argument that "things would be worse" which is a talking point right from the DNC.

Fact is, "stimulus" (20% of it) has gone out, and things are monumentally worse than they were last year. You fail to provide any facts or numbers that show this 20% of 800 billion dollars has created actual jobs (not government jobs). You won't, and you can't - because it has done JACK SQUAT.

[luckytxn 2,263]

Wow. These Socialists sure know how to spend a lot of money.

[one...two...tree 2,762]

Interesting calculation here - the budget deficit triples to 1.4 trillion. Hence, we're saying that the deficit was 1/3 of said 1.4 trillion last FY, yes? That would be roughly 466 billion.

Now, the federal debt outstanding on 9/30/07 was 9 trillion dollars. On 9/30/08 - one year later after having run a 466 billion deficit - the outstanding debt should be 9.47 trillion dollars, right? Oddly, the outstanding debt on the latter date was 10 trillion dollars suggesting that that feds had a trillion dollars worth of red ink during the previous FY. Just saying...

http://www.treasurydirect.gov/govt/reports...debt_histo5.htm

The previous administration spent a lot of money off-budget, but two wrongs don't make a right.

Some refuse to acknowledge or even understand how the stimulus has worked.

And some like you continue to use it as an unsubstantiated argument that "things would be worse" which is a talking point right from the DNC.

Fact is, "stimulus" (20% of it) has gone out, and things are monumentally worse than they were last year. You fail to provide any facts or numbers that show this 20% of 800 billion dollars has created actual jobs (not government jobs). You won't, and you can't - because it has done JACK SQUAT.

I'll place my bet on Keynesian Economics over Trickle Down Economics any time or day of the week. The historical facts speak for themselves, regardless of what history revisionists try to spin them as.

[mawilson 2,133]

I'll place my bet on Keynesian Economics over Trickle Down Economics any time or day of the week. The historical facts speak for themselves, regardless of what history revisionists try to spin them as.

Steven,

Government spending can stimulate the economy to a certain extent, but it

can't keep it going forever.

Consumption was the main engine of economic expansion from 1998 to 2007.

Banks and private households have inflated their balance sheets, creating

imbalances which have been mostly corrected by this recession. As a result,

banks are not lending as much as they used to, and consumers are saving more

and spending less.

It's clear that consumption will no longer be able to fuel economic growth and

fill the gap left by the government when the current bout of fiscal expansion

stops. The economy will have to shift from being demand-driven towards

supply-oriented, which means JOBS, JOBS, JOBS. Private sector jobs. You know,

the kind that actually CREATE wealth that can be taxed by the government.

[Pooky 3,348]

Interesting calculation here - the budget deficit triples to 1.4 trillion. Hence, we're saying that the deficit was 1/3 of said 1.4 trillion last FY, yes? That would be roughly 466 billion.

Now, the federal debt outstanding on 9/30/07 was 9 trillion dollars. On 9/30/08 - one year later after having run a 466 billion deficit - the outstanding debt should be 9.47 trillion dollars, right? Oddly, the outstanding debt on the latter date was 10 trillion dollars suggesting that that feds had a trillion dollars worth of red ink during the previous FY. Just saying...

http://www.treasurydirect.gov/govt/reports...debt_histo5.htm

The previous administration spent a lot of money off-budget, but two wrongs don't make a right.

Some refuse to acknowledge or even understand how the stimulus has worked.

And some like you continue to use it as an unsubstantiated argument that "things would be worse" which is a talking point right from the DNC.

Fact is, "stimulus" (20% of it) has gone out, and things are monumentally worse than they were last year. You fail to provide any facts or numbers that show this 20% of 800 billion dollars has created actual jobs (not government jobs). You won't, and you can't - because it has done JACK SQUAT.

I'll place my bet on Keynesian Economics over Trickle Down Economics any time or day of the week. The historical facts speak for themselves, regardless of what history revisionists try to spin them as.

I would rather trust an economic policy that truly reflected a global and interdependent set of economies, rather than one over half a century old that was very insular in its outlook. Times have moved on since Keynes, but economic theory isn't a glamour subject, so no-one has taken up the reins and brought it into the 21st Century.

[one...two...tree 2,762]

I'll place my bet on Keynesian Economics over Trickle Down Economics any time or day of the week. The historical facts speak for themselves, regardless of what history revisionists try to spin them as.

Steven,

Government spending can stimulate the economy to a certain extent, but it

can't keep it going forever.

Consumption was the main engine of economic expansion from 1998 to 2007.

Banks and private households have inflated their balance sheets, creating

imbalances which have been mostly corrected by this recession. As a result,

banks are not lending as much as they used to, and consumers are saving more

and spending less.

It's clear that consumption will no longer be able to fuel economic growth and

fill the gap left by the government when the current bout of fiscal expansion

stops. The economy will have to shift from being demand-driven towards

supply-oriented, which means JOBS, JOBS, JOBS. Private sector jobs. You know,

the kind that actually CREATE wealth that can be taxed by the government.

I understand that. We need to find a new catalyst to drive our economy and I'm convinced alternative energy could be that catalyst. The housing market really put us into a spin because people were spending on artificial credit created from a bubble that nobody wanted to see burst.

However, I don't see how we can avoid consumption being a large factor in our economy. We just need to be smarter about it.

Edited October 8, 2009 by Col. 'Bat' Guano