Thought of the Day: Budget Deficit | Madison Project

Thought of the Day: Budget Deficit | Madison Project


CBO has published their second to last monthly budget report for fiscal year 2012, which will end September 30.  Their August budget review shows that the annual deficit has reached $1.17 trillion for the first 11 months of the year.  When extrapolated out for the entire year, our final deficit should top $1.25 trillion.

Here’s something to keep in mind.  Republicans promised to cut spending when they won the 2010 elections, even though they only won over control of the House.  Well, we have actually spent more money this year than last year.  Even though the budget deficit is $68 billion lower than this time last year, we actually spent $57 billion more than in FY 2011.  Most of the gains came from increases in corporate tax revenue (not personal tax revenue).  Once again, this month showed an increase in spending on Social Security, Medicare, and TARP.

So we are on pace to spend over $3.6 trillion this year, and rack up a deficit of at least $1.25 trillion.  Let’s put this in perspective for a moment.  According to the 2009 tax data from the IRS, the top 1% of income-earners had a collective AGI of $1.324 trillion.  In other words, we would have to confiscate almost every penny of the top 1% to fill in the deficit.

And how much is $3.6 trillion?  According to the Tax Foundation, the top 10% of income-earners did not earn that much [they earned $3.38 trillion in AGI]!