Friday, October 7, 2011

Major budget items seeing sharp decline in spending



Major spending items getting crushed and total year-over-year spending now negative. This means fiscal drag is rising. It got started back in May. Charts below.








Medicare and Social Security are increasing year-over-year, but not enough to offset all spending items that are falling. Witness total spending.

14 comments:

Chewitup said...

Mike,
Check out this video by Kimbo Slice, which has gone viral this week. Unfortunately, this is how most people feel regarding balancing the budget. Caution- lots of profanity.

http://www.youtube.com/watch?v=eelNO-SvC08&feature=player_embedded#!

Lot's of work to do.

mike norman said...

Kimbo Slice???? #!@*&

It's getting more and more surreal!

Mario said...

Mike where did you get these charts? This is pretty significant.

And notice all those new NFP jobs (still not enough but alot more than expected)....I wonder if going back to school in September had anything to do with that spike!!! Those darned gubermint jobs stopping up our economy everywhere we look!!! Sheesh!!!

Kimbo Slice???? #!@*&

It's getting more and more surreal!


LOL

Below is what I posted on his youtube video. Honestly, if we can get people like this on the MMT side, we could get some real headwind. Some celebrity MMT-er would really help us out.

"balancing our budget would mean that people have less money in their wallets. We don't want to do that.

The government doesn't need tax dollars to "fund itself" b/c the government creates all US dollars. They don't need anyone to give them US Dollars since they own them and create them all they want and for the entire universe.

I hope that helps. Cheers!"

mike norman said...

Mario,

I have a database that I built that collects data from the Daily Treasury Statement going back several years. These charts come from my database. HOwever, if you want, you can get these numbers yourself by going to http://www.fms.treas.gov/dts/index.htmland comparing current fiscal year total outlays (or whatever particular line item you're interested in) to last year's outlays (or line item) using the DTS archive.

mike norman said...

BTW...look at the plunge in education spending. This doesn't even take into account what's happening at the state and local level. Winning the future? It's gonna be tough with education spending plummeting. That's the real legacy we will leave to our kids and grandkids. Not the debt, but generations of poorly educated progeny.

Mario said...

awesome stuff mike. I'm going to look into that thanks.

yes you are so right about that with regards to education and the REAL "debt" that we are facing. Perhaps that's a point that could be made on these shows you frequent. I'm already looking at homeschooling my kids (if I choose to even have any at all).

Ryan Harris said...

Govt spending decreased.
Consumer credit decreased.
Automobile inventories increased.

Our little green shoots turned brown.

But there is hope!
Cheaper commodities
The confidence fairy
"Revised" employment numbers Inspirational presidential speech
Pissed off voters protesting

Clonal said...

There was a good articles by Floyd Norris at Economix

Quote:
Today’s jobs report shows that the number of jobs in state and local government is down 3.3 percent from the peak reached in August 2008, the month before Lehman Brothers failed. (These numbers are after seasonal adjustment.)

That is the largest decline in such jobs registered since the Korean War, exceeding the fall during the early 1980s. The following chart shows the two downturns.
.
.
.
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What is remarkable about the current decline has been its relentlessness. There is an occasional one-month bounce — there was one in August — but that is probably more a reflection of poor seasonal adjustments than of actual hiring.

The early 1980s fall was more rapid, but the number of state and local government jobs hit bottom in July 1982, four months before the official end of the recession, and began to recover. The 2007-9 recession ended two years ago, but you can’t see any evidence of that in this chart.

Goyo Marquez said...

Mike:
Warren Mosler keeps saying Govt. deficit spending is still at 8%, how does this jibe with your charts?

Mario said...

oh man so I got a response from my youtube comment on kimbo slice's video. LOL here it is!!! LOL:

they cannot create all that currency smarty pants. It's called inflation you simple motherfucker. get your shit together.

hahaha

Clonal said...
This comment has been removed by the author.
Clonal said...

From Monthly Treasury Statement Aug 2011

You can do the Arithmetic

Quote:

Period Receipts Outlays Deficit
FY 2010
October 135293 311656 176363
November 133563 253850 120287
December 218919 310329 91410
January 205239 247873 42634
February 107520 328429 220909
March 153358 218745 65387
April 245260 327950 82689
May 146794 282721 135927
June 251048 319470 68422
July 155546 320588 165043
August 163998 254524 90526
September 245207 279813 34607
Year-to-Date 2161746 3455949 1294204
FY 2011
October 145951 286384 140432
November 148970 299364 150394
December 236875 315009 78134
January 226550 276346 49796
February 110656 333163 222507
March 150894 339047 188153
April 289543 329929 40387
May 174936 232577 57641
June 249658 292738 43080
July 159063 288439 129376
August 169251 303403 134152
Year-to-Date 2062347 3296399 1234052

beowulf said...

Ha ha, I came to your defense Mario, over at the Youtube comments. :o)
---------
Dru is right. Inflation is when output exceeds supply. Our huge output gap is exactly the opposite, with so much idle capacity and so many people left unemployed. Its like our economy's a farm with $2 Trillion worth of crops left alone to rot in the fields. Its worse than a tragedy, its a sin.

Only Uncle Sam has the money (it makes it!) to hire the unemployed to harvest crops, expand output and put food on the table. If you're against that, let me be the first to tell you... you're a monster.

mike norman said...

Goyo:

The deficit has declined from about 10% of GDP to around 8.5% of GDP and that explains the slowdown in growth so far this year. So Warren is right about the deficit being at 8.5% of GDP, but that's only been good enough for a 1.0% growth rate. The problem is, as these charts show, the deficit continues to decline, so Warren's 8.5% deficit figure will soon be less and that means growth could very likely go negative.