The federal government's latest fiscal year ended on September 30. The final Monthly Treasury Statement for the fiscal year, will likely be published during the coming week or possibly a few days later.
From time to time, commenters at NewsBusters have pointed that Uncle Sam's reported deficits don't represent the whole story. They are certainly right, and the press routinely ignores the rest of the story. While the press is all excited over this week's Monthly Budget Review released by the Congressional Budget Office, which contain an unofficial but probably accurate estimate that the fiscal 2014 budget deficit was "only" $486 billion, the national debt has grown by far more than that.
The following table looks at the past two fiscal years combined, because the Treasury Department's gamesmanship during the government shutdown a year ago caused the reported national debt figure on September 30, 2013 to be artifically low:
(Sources: Sept. 30, 2014 debt [interactive]; Sept. 30, 2012 debt; Estimated Fiscal 2014 deficit; Fiscal 2013 deficit)
Readers can easily see that the differences between growth in the national debt and the government's annual reported deficits are far from minor.
As has typically been the case in the past, press reports will more than likely focus on the size of the annual budget deficit as a percentage of gross domestic product. This will give readers the impression that this year's deficit, which will come in at about 2.8 percent of GDP, really wasn't all that much of a problem, because it roughly matches GDP growth.
But the growth in the national debt is what's really relevant to the nation's fiscal solvency — and it's far more troubling. As seen above, its compound rate of growth, whether one looks at all debt or the "debt held by the public" (excluding items such as the trillions owed to the Social Securty "Trust Fund"), has been far greater than GDP growth. As long as significant "off-budget" spending and obligations lead to larger debt growth than reported deficits, which are themselves expected to be roughly $500 billion or more per year as far as the eye can see, that will continue to be the case.
Especially given that midterm election season has commenced, I expect that the press will largely if not totally ignore the important information just noted here, and concentrate exclusively on fiscal 2014's reported deficit. There's no point in talking about the potential economic collapse on the horizon when there are incumbent leftist politicians who must be defended at all costs.
Cross-posted at BizzyBlog.com.
