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Guest Post: Presenting The US Government’s Infographic Of Its Own Insolvency

Tyler Durden's picture





 

Via Simon Black of Sovereign Man blog,

 

Here’s a fun way to cap off your week.

The Congressional Budget Office has just released three very telling infographics which, unintentionally, spell out a pretty dreary picture of US government finances.

The first graphic shows US federal revenue, both in raw numbers ($2.3 trillion in 2011) and expressed as a percentage of GDP (15.4%).

There are a lot of interesting things about this graphic. Check out the massive downward swing of payroll tax receipts starting in 2009… coinciding not only with the dismal rate of employment in the country, but also the demographic trend of having fewer and fewer baby boomers paying in to the system.

It’s also interesting to note that, by comparison, 2011 US tax revenue is roughly twice what is was 20-years prior. Yet over the same period, the federal debt has ballooned nearly five-fold.

The next graphic is mandatory spending– essentially Social Security, Medicare, federal unemployment, and federal retirement programs. Note: this doesn’t include things like defense, interest on the debt, etc.

At $2.0 trillion, these mandatory entitlements comprise a massive 87% of all taxes collected. Put another way, they constitute 13.6% of America’s 2011 GDP. Incredible.

The last graphic shows ‘discretionary’ spending– another $1.3 trillion. The bulk of this is defense ($699 billion), itself nearly 5% of GDP. The rest of it goes to child molesting TSA agents, government-administered education, and all the legions of three letter agencies.

At the very bottom corner is a most disingenuous statement that says ”Net Interest not included.”  In other words, they didn’t bother to include the $454,393,280,417.03 (nearly half a trillion dollars) that the US government spent on interest last year.

To put this number in perspective, the US paid more in interest last year than the entire GDP of Saudi Arabia, or the combined GDPs of the smallest 82 economies in the world. Not exactly a trivial number… unless you’re Tim Geithner.

A few days ago, Geithner quipped on NBC’s Meet the Press that there is ”no risk” of the US turning into Greece over the next few years due to such extraordinary fiscal imbalances.

This is the same guy who said there was no risk of the US losing its AAA credit rating, and that inflation on a global level is “not high on the list of concerns…”

Whether it’s lies, ignorance, or arrogance is irrelevant at this point. The situation is what it is. It’s not going to go away just because the political leadership denies it.

Each one of us has a choice. We can either bury our heads in the sand, just like they’re doing… or embrace reality and take control of our own financial futures.

 


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Fri, 04/20/2012 - 15:10 | Link to Comment bob_dabolina
bob_dabolina's picture

Shit is fucked up.

Fri, 04/20/2012 - 15:17 | Link to Comment battle axe
battle axe's picture

We be BROKE.

Fri, 04/20/2012 - 15:24 | Link to Comment Almost Solvent
Almost Solvent's picture

As per OWS: Shit Is Fucked Up AND Bullshit

But we already knew that, and so do they.

It's those of us that don't realize how true that is are the ones that will hurt the most

Fri, 04/20/2012 - 15:30 | Link to Comment markmotive
markmotive's picture

Expect more of the same until it all blows up. And the argument for more of the same...is if we don't do more of the same it will all blow up.

Doesn't make sense, does it?

Why we need to raise the debt ceiling, buy Timmy 'Turbotax' Geithner

http://www.planbeconomics.com/2011/01/06/geithner-to-congress-failure-to-raise-the-limit-would-precipitate-a-default-by-the-united-states/

Fri, 04/20/2012 - 18:13 | Link to Comment trebuchet
trebuchet's picture

Mandatory spending is not high compared to most developed countries (i.e. EU)

 

This item:  obama wants student interest rate loan freezes - talk about fixing a bubble to make it go up even more.......  and student loans being a tyler bugbear, maybe we see some response here on it

http://www.bloomberg.com/news/2012-04-20/obama-campaigns-to-press-congress-on-freezing-college-loan-rate.html

 

 

 

 

 

 

Sat, 04/21/2012 - 14:24 | Link to Comment Hive Raid
Hive Raid's picture

The DOD used to be called the War Department. Clever Bolsheviks, always changing their hosts' language. Strategic unprovoked mass murder is now benign defense.

We should really shift the common term to Murder Department... make it embarassing for the ZOG puppets every time they have to stand up and discuss the astronomical budgets for "supporting the troops".

They smoke the bees with fraudulent language. Also by presenting a unified business-like demeanor... offering the viewer's eye a continuity with respectable predecessors of generations past.

I'd like to implement a Liar-Liar amendment, where all politicians must present a facade that honestly reflects their nature and actions. Technology may be necessary to enforce the new standard, perhaps partial labotomization via directed microwaves, or a beacon may be set up in Washington which emits a special field...

I see Malcolm-O in African garb, his head drenched in red paint, ooking rhythmically to a crowd of entranced kneeling liberals. He is carried on a platter by six well-developed boys--his personal rainbow coalition ranging from light mulatto to coal black--who wear pink loincloths and pointed slippers, and ceremonial wooden swords.

Leading the entourage is the head eunuch, Jay Carney, who may only present himself naked while riding a Segway. The eunuch is adorned with a pink animal collar, to which a red ribbon is tied, and tied again to his phalus, which is held aloft to permanently display the scar where his tiny balls used to be. Shining with a coat of what appears to be petroleum jelly, the head eunuch carries himself with pomp and vanity. Proud, but privately very troubled.

The "first lady" has changed her name to Mookie the Dark. She parades herself in a shiny silver wrap (she likes shiny things), with crude holes cut out to display her substantial butt cheeks--a totem of power in the white house multiculture. She has let her hair go "natural", and with a chicken bone through her nose and face painted white, she rides in a chariot pulled by two eunuchs. Her fist is now perpetually raised defiantly in the air.

And, now that the illusion is dissipated, and all pretense and play acting has stopped, even the most boobish American takes pause, to scratch his head and wonder aloud that "sumpin aint right". Yet the question still remains as to how to proceed.

Fri, 04/20/2012 - 22:42 | Link to Comment trebuchet
trebuchet's picture

@ almost solvent interesting piccy - there is something so iceberg, titanic, yet future kiddy savings afloat  about it

 

it is very unnerving

 

 

Fri, 04/20/2012 - 21:32 | Link to Comment Neo1
Neo1's picture

A Banksters defeatism nightmare, Being forced to Return to Real Money=United States Note=Lawful Money. The real reason you pay an income tax, is for the privilege of using a private currency. Also known As A:  Federal Reserve Note, Demand from your bank or brokerage, lawful money and the tax goes away, with a tax exemption on lawful money, all of your money is yours. Use the Remedy within the Federal Reserve Act. http://savingtosuitorsclub.net/  Stop being a Slave!!!!!!  

http://www.21silver.com/?show=merrill&read=federal_reserve_act_remedy 

Tax Exemption: http://stormthunder.com/federal-reserve-act/  Web search these four different phrases: Redeemed in Lawful Money  or  United States Note  or Redeemed in Lawful Money Pursuant to Title 12 USC §411  or deposited for credit on account or exchanged for non-negotiable federal reserve notes of face value  

Fri, 04/20/2012 - 15:10 | Link to Comment Snakeeyes
Snakeeyes's picture

Cool graphics!

Is that why the Obama Administration wants to give away THE REST of the store?

http://confoundedinterest.wordpress.com/2012/04/18/reuters-uber-cool-mor...

Fri, 04/20/2012 - 15:26 | Link to Comment NotApplicable
NotApplicable's picture

Unless you try to print them.

Long on toner.

Fri, 04/20/2012 - 15:34 | Link to Comment machineh
machineh's picture

What's tragic is that the average KongressKlown looks at this chart and says, "Hey, they already colored it for me!"

Fri, 04/20/2012 - 15:34 | Link to Comment Sauk Leader
Sauk Leader's picture

Nice try CBO.

The White House, Social Security Administration, Federal Communications Commission and U.S. Administration for International Development all have published infographics on the Web in recent months, according to USA.gov.

But some of the federal agencies still may be experiencing a learning curve when it comes to visualizing data. While the CBO’s colorful interpretative images were spread around the Web and on Pinterest, a representative of the Sunlight Foundation watchdog group said the federal agency still has to improve its graphic presentation and to utilize best practices applied by other designers to make its data more clear.

“Two days ago the CBO released some new infographics about the Federal Budget in an attempt to show where revenues come from and where they are spent. Their undertaking, although valiant, falls a little flat,” Ali Felski, creative director for the Sunlight Foundation, wrote on the group’s blog on April 19. “Where these infographics go wrong is in their non-use of common graphics to represent the information more clearly and their lack of common design practices.”

Fri, 04/20/2012 - 15:41 | Link to Comment machineh
machineh's picture

Presumably the opaqueness of the chart is intentional. At a quick glance, everything looks solidly under control.

Not a clue in the chart that the deficit is running close to 10% of GDP. And that's the CASH deficit. They just ignore the GAAP figures released every December in the Financial Report of the United States.

Geither signs off on that report, too. But KongressKlowns just use it to line their birdcages. G-R-A-A-C-K! Polly wanna cracker!

Fri, 04/20/2012 - 15:47 | Link to Comment Sauk Leader
Sauk Leader's picture

The colors are all wrong too. There should only be various shades of red.

Fri, 04/20/2012 - 15:10 | Link to Comment Burr's 2nd Shot
Burr's 2nd Shot's picture

Ctrl-P is the cause of and solution to all of the world's problems (with apologies to Homer Simpson)

Fri, 04/20/2012 - 15:12 | Link to Comment carbonmutant
carbonmutant's picture

Am I being sold more QE?

Fri, 04/20/2012 - 21:12 | Link to Comment Kayman
Kayman's picture

"Uhhh... Secretary Geithner, is there any chance you might start telling the truth of the financial calamity facing this nation ? "

"No risk. Absolutely no risk. "

 

Sat, 04/21/2012 - 02:10 | Link to Comment carbonmutant
carbonmutant's picture

Absolutely...

Fri, 04/20/2012 - 15:12 | Link to Comment Lincolns Mullet
Lincolns Mullet's picture

Someone needs to make a case for a New America!  The old one is on its way out...

Fri, 04/20/2012 - 15:18 | Link to Comment economessed
economessed's picture

Again, I ask why anyone even cares about Fed.gov debt.  It's not like it's ever going to get paid back.

Fri, 04/20/2012 - 15:23 | Link to Comment NotApplicable
NotApplicable's picture

debt = money 

debt inflation = price inflation

Fri, 04/20/2012 - 17:02 | Link to Comment aerojet
aerojet's picture

It's important--what they are doing here is a desperate attempt to keep growth alive via government spending and money creation.  The debt is absolutely intentional because it has to replace consumer debt.  They have been successful at staving off deflation and keeping interest rates in the basement.  If they ever lose control or run out of strategies (and they will) then it is game over for fed.gov, Inc.  If interest rates rise they're fucked, if deflation overrides spending, they're fucked (I suspect it won't because they can print infinitely). 

Deflation would be good for middle America--increased purchasing power.  It's not good for the elite or for the government.  The most painful path for regular people is inflation, and/or hyperinflation.

Fri, 04/20/2012 - 17:20 | Link to Comment smb12321
smb12321's picture

I agree but don't think it was ever planned.  When the FED cut interest rates someone had the bright idea..."Hey, we can finance the debt with ultra-cheap bonds."  Since private buyers disappeared the FED became the principle buyer.   This process became the norm.  Now the FED is stuck.  It can't raise rates since the deficit would explode so it's helpless to prevent future inflation  (thus the constantly refiguring of inflation equations).  

I, too, see nothing wrong with deflation - cheap trips overseas, more food for the buck and a release from the relentless creeping (?) inflation tax.

 

 

Fri, 04/20/2012 - 15:17 | Link to Comment TMT
TMT's picture

I would love to see a pie chart showing what spending is constitutional versus non-constitutional.  My guess is the former will be a very skinny piece of the pie.

Fri, 04/20/2012 - 15:19 | Link to Comment sschu
sschu's picture

Each one of us has a choice. We can either bury our heads in the sand, just like they’re doing… or embrace reality and take control of our own financial futures.

Agree with the numbers and ideas that a lot of folks live in denial.  

I still struggle with the thought that when this thing comes apart that you can somehow insulate yourself from the pain.  A small number of folks will be able to, but 99.99% are at the mercy of Big Brother.  And the outlook is not good.

sschu

Fri, 04/20/2012 - 15:19 | Link to Comment buzzsaw99
buzzsaw99's picture

What do the people get in return for all the interest we pay to the bankers?

Fri, 04/20/2012 - 15:25 | Link to Comment Dr. Engali
Dr. Engali's picture

Some cheap Chinese crap and screwed up the ass.

Fri, 04/20/2012 - 15:25 | Link to Comment NotApplicable
NotApplicable's picture

The opportunity to attempt to survive another day. Quit paying, and the deal is off.

Fri, 04/20/2012 - 16:04 | Link to Comment pods
pods's picture

We get to use THEIR money.

Fri, 04/20/2012 - 23:04 | Link to Comment trebuchet
trebuchet's picture

what?!?  

 

dont you mean they get to use OUR money to pledge to government for OUR money to provide us with LOANS of OUR MONEY to pay back  OUR money to government in order to retrieve the collateral of OUR money they used to get OUR money from the government ??? 

 

For which WE PAY the privelege of CHARGES on bank accounts, INTEREST on Loans and TAXES on any liquidity provided by govt to banks?

 

Of course govt in their wisdom have decided to encourage us to be more productive they will BORROW our money via the Banks who will charge interest on OUR money to the governments and demand that WE PAY MORE TAX to ensure the govt stays afloat long enough to pay back OUR MONEY to the banks!!

 

And if you think that banks provide a service such as

a) matching Savers to borrowers, try going into a bank and SAY "HEY i HAVE A GREAT FUTURE. I HAVE NO SAVINGS. I HAVE NO WEALTH. I HAVE LOTS OF FUTURE POTENTIAL AND FUTURE EARNINGS AND THERFEFORE IN ECONOMIC TERMS AM A BORROWER"   see how much you get lent. 

b) maturity transformation 

Go into a bank and say " I AM OFFERING A SIGHT DEPOSIT OF $20K WHICH I WILL WITHDRAW IN EXACTLY 3 DAYS TIME. PLEASE CAN I HAVE A LOAN OF $ 5K  FOR 5 YEARS?  

c) Pooling of risk 

yeah, right look at the NPLs on bank balance sheets - OH YES, i forgot, they did pool the risk -  THEY ARE ON OUR BALANCE SHEETS NOW, VIA THE FED AND OTHER CENTRAL BANKS!!!!!!!!

d) Diversification of economic risks    

- SEE POINT 3 above   also REFER to YOURSELF AS A "MUPPET" AND ASK GOLDMAN FOR THEIR RECOMMENDED TRADE 

THE FALLACY OF BANKING IS THAT while these functions need to be performed in an economoy, the BANKS NO LONGER DO IT

WE ARE DOING IT OURSELVES FOR OURSELVES via govt and other inefficienty institutions

 

 

 

 

 

Fri, 04/20/2012 - 15:23 | Link to Comment JW n FL
JW n FL's picture

 

 

$454,393,280,417.03 (nearly half a trillion dollars) that the US government spent on interest last year.

So!

If the Federal Reserve Owns 60% of its Own Debt!

the 60% of this Money went back to Wall Street via the 6% the Share Holders of the Federal Reserve Collect then??

 

The Reserve Banks are not operated for profit, and ownership of a certain amount of stock is, by law, a condition of membership in the System. The stock may not be sold, traded, or pledged as security for a loan; dividends are, by law, 6 percent per year.

http://www.federalreserve.gov/faqs/about_14986.htm

I want to be a Wall Street bank with a 6% ownership dividen in the Federal Reserve..

A Fed Window @ 0.25% to draw down from!

and a Lobby in Washington DC that ensures my Tax Loop Hole / Benefit for Barrowing Money from myself! so that my Loans from the FED Window Pay me!!

http://www.frbsf.org/publications/community/investments/0308/article1a.html

http://www.federalreserve.gov/boarddocs/supmanual/bhcpr/UsersGuide11/s33.pdf <--- this is what they show! verse above.. The people get to see little if NOTHING!! for a Reason!

Fri, 04/20/2012 - 15:26 | Link to Comment Dr. Engali
Dr. Engali's picture

What is this"government " you speak of and who allows it to exist?

Fri, 04/20/2012 - 15:26 | Link to Comment Ted Baker
Ted Baker's picture

EXACTLY IT IS TIME WE TAKE CONTROL OUR OWN FINANCES AND RULE THE NATION...VIVA LA VIDA, VIVA LA FIESTA, LIBERTE AND INEQUALITE.....LA FRANCE

Fri, 04/20/2012 - 15:28 | Link to Comment Dr. Engali
Dr. Engali's picture

Viva La taco and grilled stuffed burrito

Fri, 04/20/2012 - 15:28 | Link to Comment geewhiz190
geewhiz190's picture

and both canidates and the congress have no care nor a clue. to be re-elected is all that's on the radar.

Fri, 04/20/2012 - 15:33 | Link to Comment Dr. Engali
Dr. Engali's picture

 

 

 

Fri, 04/20/2012 - 15:42 | Link to Comment Hedgetard55
Hedgetard55's picture

Sheila Bair's idea is looking more and more like genius!

Fri, 04/20/2012 - 15:42 | Link to Comment GMadScientist
GMadScientist's picture

Or you could look at it as 3% of US GDP.

 


Fri, 04/20/2012 - 15:47 | Link to Comment vegas
vegas's picture

And now you officially know 2 certain things: 1) As I have stated here before, interest rates can nevahhhhhh be allowed to go higher; Weimar Ben will insure it or the country goes bust [which is a definite possibility], and 2) gold and silver are guaranteed to go higher in the future because of the arrogance, stupidity, and financial corruption of the US gov't. Nothing like a $500 billion footnote. WTF.

 

http://vegasxau.blogspot.com

Fri, 04/20/2012 - 15:46 | Link to Comment Chaos_Theory
Chaos_Theory's picture

So what are their next steps to prop up the construct?  Nationalizing retirement savings to "protect" the voters from the evils of the market?  Nationalizing more industries?  FEMA camps, WWIII, zombie virus?????

I'm just trying to plan out when to start raising my horde for the coming wasteland fun.  Or is it strait to Winston Smith-land first? 

Fri, 04/20/2012 - 16:07 | Link to Comment pods
pods's picture

Have you ever seen The Road?

Just pray that you wont have to save your last bullet for your kid.

pods

Fri, 04/20/2012 - 19:01 | Link to Comment Chaos_Theory
Chaos_Theory's picture

Pods,

What does the timeline look like from here to there ("The Road" world)?  Will we go full-retard Oceana first, and then it collapses under it's own weight, or is it Globalization breaking down to instability, followed by brush fire wars that grow to WWIII  then to The Road for all who survive?  Seems like this path has many forks, most bad....

Fri, 04/20/2012 - 15:52 | Link to Comment Shizzmoney
Shizzmoney's picture
The Fed Plays Cute - Dylan Ratigan http://www.thenation.com/blog/167432/fed-plays-cute

“Good morning, everybody,” Chairman Ben Bernanke announced. The page went blank, actually gray. The only words that appeared were the names of the numerous participants, followed by page after page of empty gray space. At the bottom each page it said in bold type “Authorized for Public Release.” Then Bernanke spoke again. “So we’ve had a motion without objection. Okay, then the swap lines are approved. Let’s turn now to the economic situation.” Etc., etc. More empty gray pages—roughly 500 of them.

So basically all we found out is A) the majority of the people in the room for the Fed during the crisis now work in the private sector and B) we knew that they took out a ton of lunch breaks during these meetings. 

So we don't don't know what the Bernanke actually suggested or who (Blankfien) he huddled with during these troubled times......but we do have the transparent comfort of the fact during all of it, he had a Chicken Cobb Salad.

 

Fri, 04/20/2012 - 15:52 | Link to Comment Imminent Collapse
Imminent Collapse's picture

What's the point of callin shots, this cue ain't straight in line, cue ball's made of styrofoam and no one's got the time.

Fri, 04/20/2012 - 15:58 | Link to Comment XtraBullish
XtraBullish's picture

Who is that mutt on CNBC with Pisani yapping about the banks balance sheets being better? what about the Fed's balance sheet?

 

Fri, 04/20/2012 - 16:01 | Link to Comment dizzyfingers
dizzyfingers's picture

End the fed. End cartel banks. End drug wars. End wars. End government corruption. End most government agencies.

Fri, 04/20/2012 - 16:02 | Link to Comment icanhasbailout
icanhasbailout's picture

The best part is that the infographic itself was put together with borrowed money

Fri, 04/20/2012 - 17:44 | Link to Comment citta vritti
citta vritti's picture

just like the secret service hooker per diems - didn't see a line item for that - must have been swept under the rug like net interest

Fri, 04/20/2012 - 16:08 | Link to Comment Morgoth37
Morgoth37's picture

The USA is NOT BROKE! Broke means you don't have any money. No, we're infinitely worse off. We collectively as a nation owe about 100 Trillion dollars if you count all the future money promises and commitments the govt has made (SS and Medicare for example), with no plan as to where the money will come from.

The USA being "just broke" is a distant goal that we can only dream of one day reaching!

PS. I do have a solution that I think Bernanke and Geithner would love. Just print a $100 Trillion FIAT dollar bill! Problem solved!

Fri, 04/20/2012 - 17:12 | Link to Comment The Alarmist
The Alarmist's picture

Don't worry ... when inflation rears its ugly head, and it will, the PV of the unfunded liabilities will drop to $20T, or about 1 month's GDP in nominal terms.

Fri, 04/20/2012 - 17:10 | Link to Comment The Alarmist
The Alarmist's picture

OMG ... the Government has discovered EBITDA.

Won't be long before they are setting up SPV's to move CDO^2's to conduit PAYG revenues to the recipients of unfunded Social Security, Medicare and other liabilities.  Better hope you get a Class A1.  

Trust funds are so 19th century.

Fri, 04/20/2012 - 17:46 | Link to Comment citta vritti
citta vritti's picture

prelude to Romney private equity buy out? only problem, someone else has gotten there first with gubbmint already bought and paid for

Fri, 04/20/2012 - 18:19 | Link to Comment The Alarmist
The Alarmist's picture

I think Romney would do this as a Distressed Debt deal rather than pumping in equity.  When TSHTF, his debt converts to equity and he owns us all for a fraction of what an equity-round would have cost. Wouldn't be surprised if he hasn't already loaded up on CDS's on US Sovereigns.

Fri, 04/20/2012 - 23:52 | Link to Comment jack stephan
jack stephan's picture

[as the campers begin rioting]
Mr. Black: I thought you said you broke their spirits!
Jimbo Jones: [in rising fear] We did!
Mr. Black: [slapping Jimbo across the face] You broke *nothing*!
Bart: Let's get 'em!
Mr. Black: To the hydrofoil!

Sat, 04/21/2012 - 02:42 | Link to Comment TWSceptic
TWSceptic's picture

so that's what they're doing whole day, making pretty infographics about borrowed money with borrowed money. Good to know my tax money is spend productively.

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