New CBO estimates for deficit for 2013 at $642 billion

[Engineer]

http://news.yahoo.com/cbo-estimates-2013-deficit-642-billion-183237489.html

I know there will be people in here that take a giant crap all over that number but you would need to be blind to not see that the number is moving "significantly" in the right direction.

:thumbsup:

The budget office now predicts a 2013 budget deficit of $642 billion, more than $200 billion below its February estimate.

Either things are improving rapidly or the CBN data wasn't very good in February. Of course, the sequestration might have a small part to do with those Feb. numbers if they were not figured in the first time. This is essentially half (or less) of where it was just a few years ago. Hoping it can continue.

Of course, as soon as the Congress people see this, they will start to resume spending (both sides - don't kid yourself) in a bigger way....you can bank on that.

 

[PokerGuy]

Yippeeee, I'm digging the hole just a little slower than I thought. No, I'm not working on getting out of it, I'm just digging the hole a little slower than before, because fannie is paying back a little bit better than anticipated. Queue more spending!

I'm being sarcastic of course, but seeing the number go in the right direction is at least a start. Unfortunately the reasons for going in the right direction don't have anything to do with cutting our spending.

 

[Engineer]

Edit: Removed because I didn't see the "sarcasm" comment, lol!

As for cutting our spending, does the "sequestration" not count?

 

[woolfe9998]

Yippeeee, I'm digging the hole just a little slower than I thought. No, I'm not working on getting out of it, I'm just digging the hole a little slower than before, because fannie is paying back a little bit better than anticipated. Queue more spending!

I'm being sarcastic of course, but seeing the number go in the right direction is at least a start. Unfortunately the reasons for going in the right direction don't have anything to do with cutting our spending.

I see your point, but to be fair, it isn't a "little slower." The deficit peaked at what, 1.5 trill in 2009? I think it was 1.1 trill last year. It's a pretty steep year to year decline. The point being the trend line is vectoring south.

 

[PokerGuy]

Edit: Removed because I didn't see the "sarcasm" comment, lol!

As for cutting our spending, does the "sequestration" not count?

Lest you forget, the sequestration did not actually cut any spending. It simply reduced the planned increase by a tiny fraction.

 

[PokerGuy]

I see your point, but to be fair, it isn't a "little slower." The deficit peaked at what, 1.5 trill in 2009? I think it was 1.1 trill last year. It's a pretty steep year to year decline. The point being the trend line is vectoring south.

Yes, that's a good thing for sure, but equally important is the reasons for the changes. When a company announces earnings, the analysts don't simply look at the bottom line -- they examine how the bottom line came about. That's why a company can announce wonderful earnings beating expectations and the stock still gets hammered.

 

[fskimospy]

Lest you forget, the sequestration did not actually cut any spending. It simply reduced the planned increase by a tiny fraction.

After sequestration was the projected deficit larger, smaller, or the same size as it was before sequestration?

I guess if we didn't cut any spending then we can just go and restore it. Since there was no cut, restoring it is no increase!

 

[fskimospy]

I see your point, but to be fair, it isn't a "little slower." The deficit peaked at what, 1.5 trill in 2009? I think it was 1.1 trill last year. It's a pretty steep year to year decline. The point being the trend line is vectoring south.

I'm really not sure why people are looking at decreasing deficits as a good thing. Haven't we learned anything from this economic crisis? I mean all things being equal a lower deficit is good, but we appear to have sacrificed significant economic growth to lower it, something that is counterproductive in our current situation.

 

[nehalem256]

I'm really not sure why people are looking at decreasing deficits as a good thing. Haven't we learned anything from this economic crisis? I mean all things being equal a lower deficit is good, but we appear to have sacrificed significant economic growth to lower it, something that is counterproductive in our current situation.

Sounds to me like some is butt-hurt that after implementing austerity far from having deficits going up, they are actually going down more that previously projected.

 

[ivwshane]

After sequestration was the projected deficit larger, smaller, or the same size as it was before sequestration?

I guess if we didn't cut any spending then we can just go and restore it. Since there was no cut, restoring it is no increase!

Lol. Up is down, left is right, in is out, and taxes went up and the economy went up...hmm...now sounds like a good time to invent some scandals, that will stop Obama!

 

[ivwshane]

Sounds to me like some is butt-hurt that after implementing austerity far from having deficits going up, they are actually going down more that previously projected.

Lol, yep, two months in and that's a perfectly reasonable assumption. Lol

 

[First]

Full article below:

Deficit Hawks Cry Wolf

The U.S. budget deficit will shrink this year to $642 billion, the smallest shortfall in five years, according to a new government report.

The nonpartisan Congressional Budget Office today reduced its estimate of this year’s likely shortfall by more than $200 billion compared to what it had expected in February. The agency pointed to stronger-than-expected tax receipts as well as payments to the Treasury by the government-owned mortgage financiers Fannie Mae and Freddie Mac for the change.

That would be a major improvement from last year’s $1.1 trillion deficit, and would mark the first time since 2008 that the gap between taxes and spending slipped below $1 trillion.

Next year’s deficit will further shrink to $560 billion, CBO said. The deficit will continue to fall in 2015, according to the report, before beginning to grow again.

The brighter outlook will help postpone the effective deadline this year for raising the government’s debt ceiling, and may ease demands from some lawmakers for tough budget cuts. House Republicans are scheduled to meet tomorrow for two hours to consider their strategy for the upcoming debt-limit fight.

Tax receipts for the fiscal year ending Sept. 30 will be up 15 percent, CBO said, partly because Congress allowed a payroll-tax cut to expire, partly because a January budget deal allowed taxes on the wealthy to rise and partly because of economic growth.

Housing Money

Revenues this year will climb to 17.5 percent of the nation’s gross domestic product, up from last year’s 15.8 percent, according to CBO. That would be close to the 40-year average of 17.9 percent.

The other major reason for the improvement is the expectation that Fannie Mae and Freddie Mac will pay $95 billion to the Treasury this year, according to CBO.

The government took over the mortgage financiers in 2008, and that is now giving taxpayers on claim on profits now rebounding with the housing market. Last week, Fannie Mae announced it would remit $59 billion in dividends after reporting a record quarterly profit.

The deficit estimate is less than what either the White House budget office or some major banks have predicted. The administration anticipates this year’s shortfall will reach $973 billion. Goldman Sachs Group Inc. (GS) has twice cut its deficit projections this year and said last month that it expects a shortfall of $775 billion.

Barclays has said it expects a $750 billion deficit.

Are the deficit hawks now looking extraordinarily misguided? Increased taxes on the SS payroll and upper income tax bracket haven't dampened consumer demand at all (literally, at all), with retail sales again positive in April. Stock market at all-time highs. Even Fannie and Freddie are starting to pay back taxpayers, in very large sums. And all this despite gov't severe short-term spending shocks that have diminished private contractor hires that work for the feds, specifically concentrated in defense (hence the anemic Q4 2012 GDP number).

With a budget deal and immigration deal in the works likely to bring much more certainty (and most importantly, revenue) via economic growth and tax receipts, expect more good news for the country in the coming months.

Of course, first we'll have to wait for misguided members of a particular political ideology to accept that their made-up Benghazi outage really is made up, before we can move onto matters that actually affect the daily lives of American citizens.

 

[fskimospy]

Sounds to me like some is butt-hurt that after implementing austerity far from having deficits going up, they are actually going down more that previously projected.

Haha, no. Why don't you go actually look at US GDP figures over the last two quarters and get back to us.

Why you would want to revisit the austerity debate when those advocating for austerity have lost so completely and so publicly is beyond me. Watching the rats jump off the sinking ship has been satisfying, btw.

 

[woolfe9998]

I'm really not sure why people are looking at decreasing deficits as a good thing. Haven't we learned anything from this economic crisis? I mean all things being equal a lower deficit is good, but we appear to have sacrificed significant economic growth to lower it, something that is counterproductive in our current situation.

I was arguing it from the perspective of a fiscal conservative, which Pokerguy is. It isn't necessarily my own view.

However, I do think we're transitioning to a place where we can start looking at deficit reduction. Maybe cutting the deficit nearly in half from 2012 to 2013 is more than we want right now, but the economy is improving and we're getting to where we should start thinking about it.

 

[woolfe9998]

Yes, that's a good thing for sure, but equally important is the reasons for the changes. When a company announces earnings, the analysts don't simply look at the bottom line -- they examine how the bottom line came about. That's why a company can announce wonderful earnings beating expectations and the stock still gets hammered.

In your view, what are the reasons for the change?

 

[fskimospy]

I was arguing it from the perspective of a fiscal conservative, which Pokerguy is. It isn't necessarily my own view.

However, I do think we're transitioning to a place where we can start looking at deficit reduction. Maybe cutting the deficit nearly in half from 2012 to 2013 is more than we want right now, but the economy is improving and we're getting to where we should start thinking about it.

I agree, it looks like the US is on a path where in the mid term we should be looking at deficit reduction. I've always been about mid to long term deficit reduction though, I just would have paired it with more spending in the short term.

I mean if we just assume GDP growth is what it is, of course having a lower deficit is good. I just feel like we could have already been in a strong recovery at this point, something that we have avoided through premature austerity.

 

[Sonikku]

Yippeeee, I'm digging the hole just a little slower than I thought.

This. Unless the deficit is fixed in one fell swoop, I don't think it's worth bothering with. There's nothing to be happy about here, people.

 

[Paul98]

This. Unless the deficit is fixed in one fell swoop, I don't think it's worth bothering with. There's nothing to be happy about here, people.

That is impossible, this is what should be done as a way to bring things under control after the last 10ish years.

 

[sunzt]

Sounds to me like some is butt-hurt that after implementing austerity far from having deficits going up, they are actually going down more that previously projected.

Hmmm nehalem says we're implementing austerity, yet Pokerguy says we haven't cut anything....

which is it?

 

[fskimospy]

Hmmm nehalem says we're implementing austerity, yet Pokerguy says we haven't cut anything....

which is it?

It changes depending on what they are trying to argue against. When austerity doesn't work, they claim we haven't tried austerity. When things are going well, they point to how austerity works.

 

[chucky2]

"...and may ease demands from some lawmakers for tough budget cuts."

Yeeeeeessssssssss!!!!

When are we getting our $5k stimulus checks? We're no where close to the national debt being large enough to matter, so going a pittance $2T+ more into debt is meaningless, especially in light of $5k stimulus checks for all. This talk of reducing the deficit is BS, I want my mofoing $5k check. Spenders unite! Write your Congresscritters and demand stimulus!

Chuck

 

[Anarchist420]

What was the point of raising taxes if the deficit isn't eliminated?

 

[Matt1970]

Full article below:

Deficit Hawks Cry Wolf



Are the deficit hawks now looking extraordinarily misguided? Increased taxes on the SS payroll and upper income tax bracket haven't dampened consumer demand at all (literally, at all), with retail sales again positive in April. Stock market at all-time highs. Even Fannie and Freddie are starting to pay back taxpayers, in very large sums. And all this despite gov't severe short-term spending shocks that have diminished private contractor hires that work for the feds, specifically concentrated in defense (hence the anemic Q4 2012 GDP number).

With a budget deal and immigration deal in the works likely to bring much more certainty (and most importantly, revenue) via economic growth and tax receipts, expect more good news for the country in the coming months.

Of course, first we'll have to wait for misguided members of a particular political ideology to accept that their made-up Benghazi outage really is made up, before we can move onto matters that actually affect the daily lives of American citizens.

Just as much as the spending cut hawks are looking extraordinarily misguided. Both sides were squaking that either cuts in spending or raising taxes were going to make us go into a double dip recession. Both sides were wrong. And leave imigration out of this.

 

[ElFenix]

This. Unless the deficit is fixed in one fell swoop, I don't think it's worth bothering with. There's nothing to be happy about here, people.

 

[First]

Just as much as the spending cut hawks are looking extraordinarily misguided. Both sides were squaking that either cuts in spending or raising taxes were going to make us go into a double dip recession. Both sides were wrong. And leave imigration out of this.

No, not really.