Federal budget deficit hit record $3.1T in 2020, largest as a % of GDP since 1945, CBO says

[ffr]

Federal budget deficit hit record $3.1 trillion in just-ended fiscal 2020, CBO says

“Relative to the size of the economy, the deficit—at an estimated 15.2 percent of gross domestic product (GDP)—was the largest since 1945, and 2020 was the fifth consecutive year in which the deficit increased as a percentage of GDP,” the CBO said in its monthly forecast. The Treasury Department and the Office of Management and Budget will release actual figures later in the month, if the agencies hold with past practice. Notably, the CBO figure, based on daily Treasury data, was $180 billion less than it had projected only a few weeks ago, as revenues came in $123 billion above those projections and spending came in slightly below — by $56 billion — forecasts. - Marketwatch

So how is it tRump can brag about his economy when it's bleeding so much red ink?

Ah, because it's all a facade! The economy is rupturing cash like never before.

[roamer65]

1. Most of that is Treasury paper bought by the Federal Reserve.

Debt monetization.

[tecelote]

2. Why isn't this being shouted from the rooftops?

Deficit spending!

Obama was slammed on the deficit and he inherited a recession.

Trump - Largest budget deficit and largest trade deficit. Trumps a loser.

[Wellstone ruled]

3. Get use to this.

Our nation will have to pound another 5-8 Trillion in Deficit Spending next year in a effort to fix our broken economy. As one Economist said on Bloomberg a few months back,we are looking at 5 plus years to clean up what has happened.

It is going to take major Federal Tax changes which will take years before they will yield results. As Biden has said,everyone making 400k plus will see their Federal Tax load increase significantly. BTW,watch for 15 dollar minimum wage be the first order of Legislation as well as a Major bill cleaning up all the Covid fall out.

[PSPS]

4. Gee. I wonder if there was something equally challenging going on back then.

Hint: there was!

[Volaris]

5. Well then. Guess that means it's time to jack up that top tax rate to 1950s levels again.

GOP wants to run up the equalivant of a fucking war debt, then taxes can be raised to reflect. And if they dont like the second part, they can stop doing the first.

[SWBTATTReg]

6. Under a republican administration. Under a republican senate. Can't blame anyone else, eh?

[raccoon]

7. Thanks, Republicans. Nt

[Tech]

8. And the 1% are making record amounts of money.

[PETRUS]

9. Sectoral balances

Trump is a disaster in so many ways, including (but not limited to) his approach to economics. That said, federal budget deficits don't mean what you seem to think they mean. A federal budget deficit means an increase in private financial wealth - it does not mean the economy is "bleeding so much red ink" - and a federal budget surplus means the destruction of private financial wealth. This is a simple accounting identity. That isn't to say that deficits are completely innocuous. Right now too much of the private financial wealth is accumulating in too few hands, but that's not a direct result of deficits - it's about the specifics of fiscal policy and other regulations. (Also, large deficits in a full-employment economy can produce runaway inflation.) There's been a major reduction in economic activity because of the pandemic, and it's totally appropriate for the federal government to pick up the slack. I'd suggest a rather different set of spending priorities than what we've seen out of Trump and the Republicans, but deficits/debt in and of themselves are not cause for alarm.

[SoonerPride]

10. Republicans will suddenly be very concerned about the debt in January when Biden is president

Very very concerned.

"Won't someone think abut our grandchildren!"

Fuck them.