Monday, November 10, 2003

Reality Check - GAO

Thought I'd post this speech/report to show the correlation between the economists and writers I have chosen for my site and the official figures. I'm quite satisfied they match reasonably well. Check for yourself.

The United States General Accounting Office - Speech

Let me start by reviewing the federal government’s current financial condition. The federal government’s fiscal 2002 annual financial report says a lot but not enough. The good news is that as of September 30, 2002, we had about $1 trillion in reported assets. The bad news is that we had almost $8 trillion in reported liabilities. According to my math, that left us with an approximate $7 trillion accumulated deficit, or a little over $24,000 for every man, woman and child in the United States. In fiscal 2002, the federal government reported a net operating deficit of $365 billion. Many of you may be more familiar with the unified budget deficit number, which was $158 billion in fiscal 2002. Irrespective of whether you focus on the accrual based accounting numbers or the cash based budget numbers, the picture is not good and it’s getting worse. For example, the Congressional Budget Office (CBO) estimates that the unified budget deficits in fiscal years 2003 and 2004 will be $401 billion and $480 billion, respectively. These numbers are up significantly from fiscal 2002. Interestingly, CBO estimates that we will incur about $157 billion in interest on publicly held federal debt in fiscal 2003 even though current interest rates are low on a relative basis. Furthermore, CBO estimates that, excluding Social Security surpluses, the total deficit for fiscal years 2003 and 2004 will be $562 billion and $644 billion, respectively. If all these numbers are making your head spin, don’t worry; just remember that they are all big, and they are all bad! ...Speech Continued

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