What’s Driving the 2010 Deficit?
I saw this story today. And started to wonder. What is driving the 2010 deficit?
First off. A complaint:
Spending dipped 2.7 percent to $311.7 billion. Last October's outlays were inflated by the $33 billion spent on the first round of financial bailouts at the peak of the financial crisis.
If you take away that $33 billion dollars (I know you can't, but simply accounting for "normal" spending), then spending actually rose 3% over last October. The deficit for October is $176.4 billion - remember when yearly deficits under Bush were much and people went mental? We are set to high Bush's highest deficit number (sans 2008) in December of 2009. For the 2010 budget. Scary.
Revenues continue to drop.
The imbalance came mostly from lower receipts of individual and corporate taxes. Receipts were $135.3 billion, a 17.9 percent drop from last October.
Obviously due to the fact that more people are unemployed now. 10.2% or 17.5%, depending on how you want to count. I like the 10.2% number, myself. Because it's the normal standard we use and the 17.5% counts people who are "under-employed" but I don't think it's a number you can assign responsibility for.
Here's the point of this post though:
The Obama administration expects this year's deficit to reach $1.5 trillion. That would make it the third straight record annual deficit.
If TARP ($700 billion) and Porkulus ($787 billion) drove the 2009 deficit. What is driving the $1.5 trillion one in 2010? If those are one time expenses, they do not count for 2010 in government accounting. So what's driving it? If TARP is included in the 2008 Deficit (as I thought it was, which is why the final Bush deficit was so high), why is it also accounted for here, as part of the 2009 deficit?
You'd think, naturally that if you remove ~$1.5 trillion from the books, you'll be in much better territory. The 2009 deficit was around $1.8 trillion ($1.4 is what DC uses officially, as they removed ~$400 billion off book). So if you take $1.5 trillion away from this, shouldn't the deficit be back down to around $300 billion?
If not. Why not? Why is it so high for 2010?