OVERVIEW OF THE PRESIDENT’S 2009 BUDGET
- Estimated receipts for fiscal year 2009 are 2.7 trillion(+7.1%).
- Mandatory spending: $1.89 trillion (+6.2%)
- Discretionary spending: $1.21 trillion (+4.9%)
My question is a simple one: Gee, do you think 4.1% annual GDP growth is just a bit optimistic?
The current math looks something like this:
Let's assume the government's $1.5T unforeseen shortfall is half revenue loss and half spending gain. That amounts to $2T in revenue (shockingly, our current deficit now = our total revenue; like charging up $200K per year on credit cards if you make $100K), a 25% annual decline from the projected number. Spending works out to be a similar a 25% annual increase.
Now, if you extend the actual trend to 2019, you find a mere $200T in new debt. Probably closer to the truth. ...at least for a few years, until something snaps.