The Signal is A G E

 The two sides of the debt coin are low revenue and high expenses. 

 

Last week I shared information that the long-term year over year (y/y) decline in corporate tax receipts has contributed to our nation’s ballooning debt balance, now at over $36 trillion per usdebtclock.org.

 

This week I share the other main cause to our debt; it may surprise you, then again maybe not.  Please see the following charts.  

• The first chart shows expenses whether discretionary or mandatory and which area.

• The second chart shows these expenses grouped together to help tease out the signal.

• The third chart adds an element, which is the signal.

• The fourth chart shows another way to view the expenses, which can be used to help you determine the area our government should focus its attention to contain costs that will surely continue to grow.

 

I will soon share the expense area on which we should focus, and it is not majoring in minors that discretionary expenses represent.

 

Lastly and most importantly, are our financial managers (those that we sent to Washington DC) to make financial decisions on our behalf looking at & presenting our revenues, expenses, and current financial position in this manner?  If you were a member of a Board of Directors for a non-profit, would you not look at it in this manner?  I think you would.  If not, then please share with us how we should look it.

Let's Stop Playing Games

 Our national debt is primarily due to:

1. Corporate tax cuts going back 50 years,
2. The War on Terror, &
3. Our Federal Government’s response to COVID.

 

I make this conclusion based on my analysis of data obtained from the Congressional Budget Office (CBO) and FRED - Federal Reserve Economic Data.  Please see the following four charts to discern that picture.

I realize this a high-level look back of what-ifs, but it does indicate that we need to raise taxes if we want to prevent a debt crisis.  I do not believe we can cut expenses to solve our problem.  Moreover, I think expenses have been cut, what else may explain the dips in the national debt when individual tax receipts as percentage of GDP decreased?  Looks like I will have to do some more research to find out.  Stay tuned.

 

 

Lastly, if you want to see my workbook then please send me a note.

All Is Quiet At The Capital - No Assault, Unlike 4 Years Ago

Donald J. Trump’s presidential win was certified today without incident. To paraphrase House Minority Leader Hakeem Jeffries, this cycle saw “no election deniers”—a stark contrast to four years ago when 147 Republican members of Congress voted against certifying Joe Biden’s victory.

These 147 Republicans rejected the certification, not on the basis of facts, but fueled by falsehoods and deceit ushered in by Donald Trump. Their votes against certification represented, arguably, an attack on the very foundations of our democratic republic (DR) —a government of the people, by the people, for the people. Their efforts sought to sow fear, uncertainty, and doubt (FUD), with the ultimate goal of forcing a “contingent” election under the 12th Amendment. But as most of us know and readily acknowledge, there was no factual basis for this FUD.

The harm caused by this behavior is profound. It has led to criminal convictions, broken relationships, and most damaging of all —undermined trust in our election system. The lies propagated by Donald Trump, and echoed by numerous Republican leaders at all levels of government, have inflicted lasting damage on our democratic processes.

Until the Republicans who perpetuated these false narratives acknowledge the harm they have caused, our DR remains at risk. We must remain steadfast in our commitment to protecting the principles that form the bedrock of our government. This is not merely a political struggle —it is a fight to ensure our unalienable rights are secure.