May 21st, 2024 - Volume 10 (2024), Missive 114 (Tuesday)
Social Benefits Remain The Largest Government Expense By Far
Grants Still Account For A Large Slice Of The Expense Pie Than Interest
Student Loan Receivables Continue To Climb
Budget deficits, and surpluses for that matter, are always a tricky subject to delve into, especially for those who don’t necessarily deal with budgeting on a day to day basis. For example, if you’re not at the ‘table’ when it comes to making financial decisions, analyzing a budget really doesn’t do you any good. More so, it is only human to want to see as much in balance as possible, especially when that comes to finances. A household checking book, for example, should always be in balance. That’s why it can be difficult to talk about the U.S. budget given how far most people feel from being involved in the decision making process. In the end, as a democracy we are accountable only to ourselves. However, in a democracy of 300+ million people in charge of an economy producing $35.0 Trillion in output, it is easy to see how ‘removed’ a significant portion of the population feels (despite the numbers, we’re fairly certain that this feeling has always been the case). In spite of those gaudy numbers, another number exists that’s even bigger and plays a much more crucial role in the operating budget than population or production does. Unfortunately, this number is also almost impossible to accurately define which makes the whole analysis around how we spend our money than much more complex and confusing.
When it comes to line item expenses, it is social benefits that accounts for almost half of all spending (note that defense spending is considered an investment and therefore not included in line item expenses).
Although the Congressional Budget Office (CBO) does what it can to pin it down, the simple economic fact of the matter is that determining an accurate estimate of the economy’s current rate of long-term potential is all but impossible. And we’re not even talking about getting actual potential down to the penny, rather even just in the ballpark so that it is useful. Yet, it is the potential of the U.S. economy that determines
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