No Runny Eggs

The repository of one hard-boiled egg from the south suburbs of Milwaukee, Wisconsin (and the occassional guest-blogger). The ramblings within may or may not offend, shock and awe you, but they are what I (or my guest-bloggers) think.

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Archive for the 'Economy' Category

January 4, 2011

Number of the day – $14,025,215,218,708.52

by @ 0:34. Filed under Economy Held Hostage, Politics - National.

That number is the total amount of federal government debt outstanding as of 12/31/2010. Of that, $9,390,476,088,043.35 (plus about $10 million, or if you prefer, $0.00001 trillion in what is termed “guaranteed debt of government agencies” that is somehow not part of the public debt but is part of the “debt subject to limit”), and $4,585,749,068,174.55 in “intragovernmental debt” (that would be, for the most part, the various “Trust Funds”). To put it in a bit of text perspective, the Gross Domestic Product was $14.119 trillion in 2009, and if projections can be believed, will come in at just over $14.7 trillion in 2010. That makes the public debt just under 64% of GDP and total debt over 95% of GDP.

That dry text doesn’t, however, do it justice. I decided to go through 40 years’s worth (or, give or take a few shakes of a lamb’s tail, about the length of time I’ve been walking the Earth) of calendar-year-ending Monthly Statements of the Public Debt, grab the GDP for each of those years (estimated for 2010), and whip up a “little” frightening chart for you:


Click for the full-size chart

The short version of that chart:

  • Between 1970 and 1981, total debt remained right around the 37% of GDP, and publicly-held/guaranteed debt remained right around 27% of GDP.
  • Publicly-held debt plateaued right about 40% of GDP between 1986 and 1989, but because of changes to Social Security, the increasing intragovernmental debt, which crossed the 10% of GDP threshhold in 1988, caused total debt to continue to increase at an unchanged rate.
  • Sticking with intragovernmental debt briefly, it steadily increased to a high of nearly 32% of GDP in 2009 before multiple “trust funds” began running deficits, both primary (cash) and gross, helping to increase the publicly-held debt as said “trust funds” get monetized through borrowing while there is exactly $0.00 set aside or otherwise available for the purpose.
  • Back to the publicly-held debt, it again plateaued at 50% of GDP between 1992 and 1996, with total debt plateauing around 68% of GDP, before “unified budget surpluses” and a gangbusters economy allowed them to go down as a function of GDP.
  • By 2000, total debt dropped to about 57% of GDP, with publicly-held debt hitting its post-1981 low of 33% of GDP in 2001. While publicly-held debt remained about 37% of GDP through 2007, the increasing reliance on “trust fund” surpluses caused total debt to increase to about 66% of GDP in 2007.
  • The muzzle came off the debt monster in 2008, with publicly-held debt increasing to about 64% of GDP and total debt increasing to about 95% of GDP by the end of 2010.

Several of those in my bloated feed reader, like Dad29, Zip, Allahpundit Stephan Tawney, and ultimately NRO’s Corner crew, found yet another utterance from Barack Obama that has reached its expiration date – one from a 2006 debate in which he opposed raising the debt limit as Senator, an act which his economic advisor now calls “insanity”:

The fact that we are here today to debate raising America’s debt limit is a sign of leadership failure. It is a sign that the U.S. Government can’t pay its own bills. It is a sign that we now depend on ongoing financial assistance from foreign countries to finance our Government’s reckless fiscal policies. … Increasing America’s debt weakens us domestically and internationally. Leadership means that ‘the buck stops here. Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren. America has a debt problem and a failure of leadership. Americans deserve better.

The publicly-held debt was 37.3% of GDP at the end of 2005 and 36.6% of GDP at the end of 2006, while total debt was 64.6% of GDP at the end of 2006 and 64.4% of GDP at the end of 2006.

Revisions/extensions (7:02 am 1/4/2011) - The Emperor links, and provides a further link to Aaron Worthing at Patterico’s Pontifications and the full Obama remarks that were walked back. The relevant extension:

Over the past 5 years, our federal debt has increased by $3.5 trillion to $8.6 trillion. That is “trillion” with a “T.” That is money that we have borrowed from the Social Security trust fund, borrowed from China and Japan, borrowed from American taxpayers. And over the next 5 years, between now and 2011, the President’s budget will increase the debt by almost another $3.5 trillion.

For those who can’t do the math, Obama was complaining about a potential $12.1 trillion total debt by the end of 2011. Well, we’re at just over $14 trillion before we got to the beginning of Calendar Year 2011 (or if you prefer, a quarter of the way through Fiscal Year 2011). The kicker – had Pelosi taken up Obama’s proposed budget, the total debt would be $15.1 trillion at the end of FY2011.

R&E part 2 (7:45 am 1/4/2011) - Dan Spencer points out just how much the debt has gone up under Nancy Pelosi’s now-expired Speakership – $44,662 for every man, woman and child who make up the 310,574,015 U.S. populace.

A minor point of order – the first 9 months of 2008 were largely budgeted by the prior Congress, while the last 3 were budgeted solely by Pelosi and Senate Democrat leader Harry Reid. That explains why the deficit, at least as a percentage of GDP, didn’t increase all that much in 2007.

I might redo the chart to reflect fiscal years instead of calendar ones, but it is a bear to get the numbers.

December 23, 2010

Budget Chop – Bureau of Ocean Energy Management

by @ 9:58. Filed under Budget Chop, Economy Held Hostage, Energy, Politics - National.

During his 2010 victory lap yesterday, President Obama laid out his priority for 2011:

Asked about the often-used car in the ditch analogy, Obama said that the “car [the economy in the analogy] is on level ground.” He spoke about a new direction for the government’s economic focus: “We now have to pivot and focus on jobs and growth,” and education, innovation, and R & D.

While Obama’s lips may be saying “yes, yes,” his double crossed fingers are saying, “no, no!”

Gulf oil drilling jobs continue to be decimated as Obama via the Bureau of Ocean Energy Management, works to interfere with, delay or halt altogether, permits for drilling. Most people are aware that Obama has denied an expansion of drilling areas and has delayed permits for new deep water rigs. What folks aren’t aware of is that even in areas where drilling is allowed, even in shallow water, the Bureau has implemented a plan that some would interpret as down right hostile towards all drilling efforts.

While you might think the Bureau is taking time advancing permits to ensure that safety comes first, they’re not. They are doing mostly what bureaucracies do, create process for no end result benefit:

Yet regulators have tightened processes so much that permit applications are being returned six and seven times for more information, says Randall Stilley, Seahawk’s chief exec­utive. One operator con­fided its last rejection was because the application contained two font sizes, he said.

(emphasis mine)

I’m a big believer in pay for performance i.e. if you perform well, you get paid more. I think we should use this type of approach to government agencies. Going forward, I would propose that Congress cut the budget for the Bureau of Ocean Energy Management. After all, how many people should it take to just say “no” to every inquiry of permitting for an ocean drilling rig?

December 20, 2010

The Budget Chop

by @ 19:45. Filed under Budget Chop, Economy Held Hostage, Politics - National.

Reports are circulating that Republicans and someone on the Democrat side (who is in charge there anymore?) have agreed to a clean continuing resolution bill that will extend the current budget levels into sometime in the first quarter of 2011.  All in all, that’s probably good news.  I don’t trust the current set of Republicans to actually have a spine and argue with any Democrats over budget levels.  I certainly don’t have any hope that the current bunch could actually cut the budget.  I lay all of my hopes on the incoming freshman class.  I hope I’m not disappointed.

However, I don’t think it’s fair to toss these freshmen to the wolves.  

As part or our ongoing public service efforts to provide clear, conservative thinking, we here at NRE have decided to start providing crib notes for the freshmen class on where, what and how to cut the federal budget.  This post is the first in the series.

Janet Napolitano announced today that the Department of Homeland Security, along with it being ever vigilant in finding new ways to amuse terrorists and piss off non Muslim air travelers, is taking on a new task.  DHS is making contingency plans in the event that climate change impacts domestic security.  Under the banner of “evironmental justice,” Napolitano has DHS making plans of what to do if oceans rise, glaciers melt or some change in weather occurs. 

As if it wasn’t bad enough that Napolitano wasted DHS time on this nonsense, she also included other executive staff. White House Council on Environmental Quality Chair Nancy Sutley, EPA Administrator Lisa P. Jackson, Attorney General Eric Holder, Secretary of the Interior Ken Salazar, Secretary of Labor Hilda Solis, and Secretary of Health and Human Services Kathleen Sebelius were all included as speakers for the event.

Hey Freshmen, if Napolitano has enough people with enough time to worry about such things as “evironmental justice,” regardless of what the real focus is, she has too many people with too much time in her budget! DHS should be the first agency to experience significant budget cuts!

As I said, we’ll be pointing out budget chop items as we find them. My plan is to get a neato graphic that can be added to highlight the budget chop posts. I don’t have it yet. In the meantime, let’s see if this sets the mood:

October 15, 2010

We’re number 43 (again)

by @ 8:55. Filed under Economy Held Hostage, Politics - Wisconsin.

Forbes magazine came out with its 5th annual “Best States for Business” ranking, and for the fourth straight year, Wisconsin is in the bottom 10. Even the “improvement” from 48th last year to 43rd this year, which matches where Wisconsin ranked in 2008, is not exactly good news.

Since the story doesn’t mention Wisconsin directly, we have to draw conclusions from the somewhat-limited tables. The business cost rank, which measures the costs of labor, energy, and taxes, remained unchanged from 35th last year among the 50 states, which continues to be the worst position Wisconsin has been in that metric. The labor supply rank, which measures educational attainment, net migration and population growth, likewise remained unchanged at 36th. The regulatory environment rank, which includes not only regulatory and tort climate, but incentives, transportation and bond rating, somehow improved a spot to 36th this year. The quality of life ranking, a measure of schools, health, crime, cost of living and poverty rates, likewise improved a spot, from 11th to 10th.

The big “improvement” was the economic climate rank, which measures job, income and gross state product growth as well as unemployment and presence of big companies. That rose from 41st to 35th despite the gross state product declining from $198 billion to $196 billion, mostly on fact the recession hit Wisconsin earlier and harder than most other states. The August 2009 non-adjusted unemployment rate was 8.6% in Wisconsin and 9.6% nationwide, while the August 2010 non-adjusted unemployment rate was 7.7% in Wisconsin and 9.5% nationwide.

However, even that bit of news is not exactly rosy. On the current trajectory, Wisconsin’s growth prospects rating, a projection of job, income and gross state product growth as well as business openings/closings and venture capital investments, fell from 45th to 47th, its worst rating in the 5-year history.

Translation – If you want to have Wisconsin once again be among the 5 worst states for business, keep the Democrats in power. If you want a shot of improving Wisconsin’s business climate, give the Republicans a chance.

No Soup For You!

by @ 6:54. Filed under Economy, Economy Held Hostage.

In case any of you are still wondering whether the current administration had the intellectual strength to handle the current economic challenges:

No Soup for you:
Social Security to announce no COLA for 2011

Oh, don’t get me wrong, COLAs are what they are and if zero, well, that’s what it is. It does however, seem a bit ironic that seniors who will be getting no COLA will also be getting the “benefit” of Placebocare which will actually increase their health care costs.

Because we’re still spending like drunken sailors:
Government to report on $1 trillion-plus deficit

The economic acts of the Obama administration continue to play out as if they were planned by the, out of touch with reality, Dr. Evil.

I wonder if Obama has found anyone to glue lasers to the shark’s heads yet?

US Economy held hostage….18 more days!

October 8, 2010

Employment estimate divergence, private enterprise versus government edition

by @ 8:57. Filed under Economy Held Hostage.

On Wednesday, ADP said that seasonally-adjusted private-sector employment dropped by 39,000 in September, down to 106,949,000. Yednesday, Gallup asserted that their measure of non-seasonally-adjusted unemployment went up from 9.3% at the end of August (itself up from 9.1% in the middle of August) to 9.4% in the middle of September and 10.1% at the end of September. Today, the Bureau of Labor Statistics said seasonally-adjusted private-sector employment rose by 64,000 to 107,970,000, and that the non-seasonally-adjusted unemployment rate dropped from 9.5% in August to 9.2% in September.

One of these things is not like the others.

September 13, 2010

Economy – Still Held Hostage

by @ 20:06. Filed under Economy, Economy Held Hostage, Politics - National.

In what looked like some macabre version of a Norman Rockwell painting, President Obama sat a a picnic table with a family in Virginia who appeared hung on his every word as he attempted to explain why the bad part of the economy wasn’t his fault. In his comments, which were dutifully reported by the AP, he said that he would likely compromise with the GOP over deficits and other issues. He went on to blame the GOP and John Boehner specifically, for blocking the extension of the “Bush tax cuts.”

It’s funny that Obama looks for a GOP villian to blame whenever things aren’t going his way. Last I looked, the Democrats still have the majority in the House. Last I looked, it only takes a majority to pass a bill in the House. Last I looked, the logical extension of the previous two sentences is that in the House, Democrats alone, can pass any version of tax increases or decreases, without a single Republican vote.

My history may be a bit fragmented; did Republican votes in the House pass Obamacare? Were Republican votes in the House required to pass cap and tax? My recollection is that Democrats, whipped by Nancy Pelosi and President Obama, thought these issues were so important that they through their political bodies off of the Capital rotunda to pass these bills. Political courage is what President Obama and Nancy Pelosi called Democrat House members to have. Political courage they had and political consequences they will now reap.

Every one who has polled the topic has found that a significant majority of Americans want the tax cuts extended. One would think that those who had the political courage to go against the American majority on Placebocare and Cap and tax would find it easy to side with their constituents for an extension. They would, that is, if it was really what Obama wanted to do.

I can see November from here. In fact, I can see it in HD (Hardly any Democrats).

September 10, 2010

Friday Hot Read Part 2 – Dick Leinenkugel’s and Bill McCoshen’s “Understanding how industrial revenue bonds work”

by @ 8:14. Filed under Economy, Politics - Wisconsin.

Two former Wisconsin Secretaries of Commerce, serving under both Republican and Democrat governors, opened Economics 201 over at WisOpinion with an explanation of how Industrial Revenue Bonds work. For those late to the party, that has become an issue in the Senate race because Pacur, which is owned by Republican front-runner Ron Johnson, utilized IRBs to expand its business. Let’s go to the bottom line:

Bottom line is IRBs are a smart financing tool for manufacturers considering construction, expansion and or the purchase of equipment, something that Ron Johnson and his company has been doing while providing more than one hundred and twenty jobs in Wisconsin for over 30 years. Taxpayers benefit from IRBs through new jobs in the community and additional tax base. There is no government guarantee and taxpayers have no risk in an IRB loan because private lenders and the company itself assume the risk.

September 8, 2010

9.6% – then and now

by @ 9:54. Filed under Economy Held Hostage, Politics - National.

Once again, I’ll borrow the 4-Block concept from Tom McMahon, this time to demonstrate the ever-changing definition of a “good” economy in the Democrat playbook.

Measure of unemployment at 9.6% Democrat reaction
2004
U-6 (includes discouraged workers; “official” rate about 5.5%) “Worst economy since the Great Depression”
2010
U-3 (“official” rate; U-6 rate 16.7%) “The new normal”

Revisions/extensions (11:14 am 10/8/2010) - The September 2010 U-6 rate rose to 17.1%, while the September 2010 U-3 rate remained at 9.6%.

August 25, 2010

It’s For the Chiiiiiiiiiiillllllllldren!

by @ 7:11. Filed under Economy, Economy Held Hostage, Education.

Quick, see if you can find the link between these two stories:

LA unveils $578M school, costliest in the nation

The RFK complex follows on the heels of two other LA schools among the nation’s costliest — the $377 million Edward R. Roybal Learning Center, which opened in 2008, and the $232 million Visual and Performing Arts High School that debuted in 2009.

Los Angeles is not alone, however, in building big. Some of the most expensive schools are found in low-performing districts — New York City has a $235 million campus; New Brunswick, N.J., opened a $185 million high school in January.

And:

EBay, Adobe Leave California for Utah

If you guessed: Ebay, Adobe and others like them, hate children, you are correct!

Disclaimer:  I received no consideration or payola of any kind for this message.  My name is Shoebox and I approve this message!

Revisions/extensions (12:38 pm 8/25/2010, steveegg) - I was going to put this in the comments, but upon reflection, I decided it needed to be part of the main post. Those prices almost makes the $50 million (roughly $23 million from private sources, including $20 million from the Pettits) spent building Milwaukee Public Schools’ Bradley Tech High School back in 2002 seem quaint. Of course, money spent on shiny new facilities are no guarantee of success – Bradley Tech is one of the 12 worst-performing high schools in all of Wisconsin.

August 19, 2010

What? Me Worry?

by @ 9:30. Filed under Economy, Economy Held Hostage, Politics - National.

Alfred E. Neuman was and is smarter than Joe Biden!

Jobless claims at 9-month high

Initial claims for state unemployment benefits increased 12,000 to a seasonally adjusted 500,000 in the week ended August 14, the highest since mid-November, the Labor Department said on Thursday.

From Biden – the Oracle of the Economy

I have to admit that I thought we were all being set up when at the end of April, Vice President Biden said:

Well, I’m here to tell you, some time in the next couple of months, we’re going to be creating between 250,000 jobs a month and 500,000 jobs a month.

I thought for sure that Biden was just giving us another chorus of happy talk from the administration. I didn’t see anyway, at least by looking out my economic window, that the economy was about to do anything regarding jobs, that would be at a level of nearly 500,000!

I was wrong! Vice President Biden was right!

Today, in another unexpected surprise, the Labor Department announced that new claims for unemployment insurance rose to 479,000! Admittedly, that’s not 500,000. However, I have to give VP Biden kudos for having the foresight to predict a number that appeared incredibly outlandish to us rubes on the sidelines. 500,000 would have been great but 479,000 is nothing to sneeze at! Great job Vice President Biden! It surely is “Recovery Summer!”

Uh, what?…He predicted 500,000 new jobs but we have nearly 500,000 new people collecting unemployment? Um….that’s not good!

Never mind!

I doubt Obama’s unpopularity will be improving anytime soon. In the event that any of the Libs are still wondering why the American people have become so “stupid” as to turn against the rainbows and unicorns in every pot…..It’s the economy, stupid!

August 8, 2010

America’s Economy Continues to be Held Hostage

by @ 16:58. Filed under Economy, Economy Held Hostage, Politics - National.

From the Financial Times:

Fed set to downgrade outlook for US

This sounds awful pessimistic for it to be included in Recovery Summer!

Faced with weak economic data and rising fears of a double-dip recession, the Federal Open Market Committee is likely to ensure its policy is not constraining growth and to use its statement to signal greater concern about the economy. It is, however, unlikely to agree big new steps to boost growth.

Do you think there is any coincidence between the Fed’s view of a deteriorating view and Christina Romer’s exit this week?  Maybe Romer finally got tired of carrying the fouled bucket of water that is Obama’s economic policy.

August 5, 2010

Biden the Oracle of the Economy

by @ 10:06. Filed under Economy, Economy Held Hostage, Politics - National.

I have to admit that I thought we were all being set up when at the end of April, Vice President Biden said:

Well, I’m here to tell you, some time in the next couple of months, we’re going to be creating between 250,000 jobs a month and 500,000 jobs a month.

I thought for sure that Biden was just giving us another chorus of happy talk from the administration. I didn’t see anyway, at least by looking out my economic window, that the economy was about to do anything regarding jobs, that would be at a level of nearly 500,000!

I was wrong! Vice President Biden was right!

Today, in another unexpected surprise, the Labor Department announced that new claims for unemployment insurance rose to 479,000! Admittedly, that’s not 500,000. However, I have to give VP Biden kudos for having the foresight to predict a number that appeared incredibly outlandish to us rubes on the sidelines. 500,000 would have been great but 479,000 is nothing to sneeze at! Great job Vice President Biden! It surely is “Recovery Summer!”

Uh, what?…He predicted 500,000 new jobs but we have nearly 500,000 new people collecting unemployment? Um….that’s not good!

Never mind!

July 29, 2010

Another Tax Man stinker – 2008 edition

by @ 20:31. Filed under Economy, Politics - National, Taxes.

(H/T – Charlie Sykes)

In his discussion of the requirement of every small business to report to the IRS every payment of at least $600 in the aggregate (discussed here earlier this year), David Frum found a real gem of a form – Form 1099-K (draft version). While that is not the form he is thinking of, one of his readers remembered what that form is for. It seems a credit/third-party network transactions reporting requirement was slipped into the “Housing Assistance Tax Act of 2008″ by Harry Reid and his fellow Senate Democrats, and it is a doozy, and the IRS made it an even bigger doozy in its proposed implementing regulations.

To cut to the quick; all payment-card payments (on cards issued by an entity unrelated to the entity accepting final payment) and all third-party network transactions that exceed $20,000 and 200 transactions to a particular payee in a year from said network (not from an individual account holder, but from every account holder) must be reported on an aggregated monthly basis, and a separate 1099-K must be filed for each determinable cardholder/account owner.

Are you going to use that Chase MasterCard to buy a $800 computer from Best Buy in March 2011? Are you going to use your debit card to buy a $8 meal from Culver’s in April 2011? Are you going to use PayPal to buy a $500 airline ticket from AirTran in June 2011? Will you be passing through a tollbooth using EZ-Pass in January 2011? Will you be using a WMATA SmarTrip card on a DASH bus in February 2011? Will you be making a phone call using a prepaid phone card in September 2011? If so, the IRS will find out about it.

But wait; it gets “better”. If you accept a payment-card or third-party network transaction, you better tell that card or payment company your correct Taxpayer ID Number if you don’t want them to withhold federal taxes on the payments due you.

I suppose there is one little bit of good news. If those proposed IRS regulations I linked to go through without changes, those of you with businesses just might have a little less paperwork to deal with. If all of your payments to a particular vendor are made with a business credit card, you won’t have to report those payments because your credit card company will take care of that for you.

July 24, 2010

The most laughable guest opinion that has run so far this year in the MJS appears in Sunday’s paper

by @ 20:39. Filed under Economy, Miscellaneous, Politics - National.

See it here now.

Absolute garbage.

AP: Unemployment unchanged by stimulus

Economists: The stimulus didn’t help

100 stimulus projects: A second opinion

Feds to spend $795,000 to create 5,000 rural jobs

July 16, 2010

Behind the jobs numbers, Wisconsin edition

by @ 13:57. Filed under Economy Held Hostage, Politics - Wisconsin.

I’m sure you’ve heard the spin that the unemployment rate in Wisconsin dropped 3/10ths of a point to a seasonally-adjusted 7.9% last month, and that it was a full percentage point lower than that of June 2009. A deeper look at the numbers, however, show that it’s not because private entities are hiring, but rather people no longer even trying to look for work.

First, let’s take the seasonally-adjusted numbers for a comparison between May and June. While the ranks of the unemployed (or at least those who looked for work in the prior 4 weeks) dropped by 9,700, the ranks of the employed also dropped by 3,900. That means the civilian labor force dropped by 13,600, or 0.45%. Meanwhile, both private-sector employers (to the tune of 1,000) and government (to the tune of 7,200, half by the federal government as the temporary census workers were let go, the other half evenly split between state and local governments as the school year ended) shed a total of 8,200 jobs.

Next, let’s compare the non-adjusted numbers between June 2009 and June 2010. 41,600 (or 1.48%) fewer people were employed this June versus last June, and 39,400 (or 13.71%) fewer people were on the actively-seeking-work portion of the unemployment rolls, resulting in a civilian labor force drop of 81,000 (or 2.57%). The private sector cut 23,100 (or 0.98%) jobs, while government added 5,000 (or 1.17%) jobs. While state government did cut 3,200 (or 3.33%) jobs, the federal government grew by 4,400 (or 14.72%) and local government grew by 3,800 (or 1.26%). The only sectors that added jobs in the last year were mining (+300/9.38%), durable-goods manufacturing (+700/0.27%), admin support/waste management (+5,100/4.36%; some of which are likely local government), education (+3,000/6.16%; mostly state and local government), health care/social assistance (+4,100/1.12%; with a significant government component), and accomodation/food service (+4,800/2.09%).

Hopefully Wisconsin can survive the local version of the POR (Pelosi-Obama-Reid) Economy – the DDS (Doyle-Decker-Sheridan) economy until that troika leaves power in the state. I don’t think the state can survive another full year of this.

July 13, 2010

Speaking of SocSecurity, the preliminary June 2010 update

by @ 17:55. Filed under Economy Held Hostage, Social Security crater.

The Treasury released its June 2010 Monthly Treasury Statement, and things just keep on getting worse for Social Security. Do bear in mind these numbers are still preliminary because the Social Security Office of the Chief Actuary hasn’t finalized them yet, but let’s run with them.

Overall

I really should not do the combined numbers anymore because the two “trust funds” are separate entities, but since everybody else still does them, I’ll briefly touch on it. They took in a total of $56,808 million in taxes, received $59,072 million in “interest” (because this is one of the two times interest is credited to the entire holdings), and paid out $63,308 in expenses. That left a gross increase in assets of $52,572 million (45.37% of total revene) and a primary (cash) decease in assets of $6,500 million (-11.44% of tax revenue). The 12-month gross surplus was $90,183 million, while the 12-month primary deficit was $28,260 million.

DI “Trust Fund”

The Disability Insurance “Trust Fund” had $8,249 million in taxes, $4,706 million in interest, and $11,018 million of outgo. That netted a monthly overall surplus of $1,778 million (worst June since 1994) or 14.95% of total revenue (also the worst June since 1994), and a monthly primary deficit of $2,769 million (5th-worst month, outside the “double-payment” month of August 1990, since monthly recurds were kept starting in 1987) or -33.57% of tax revenue (9th-worst “not-screwy” month since monthly records were kept).

The 12-month overall deficit was $18,725 million (worst since monthly records were kept) or -17.68% of total revenue (also worst since monthly records were kept). That meant that the “trust fund” lost 8.78% of its value over the past 12 months.

The 12-month primary deficit was $28,708 million (worst since monthly records were kept) or -29.93% of tax revenue (also worst since monthly records were kept). Put another way, tax revenues only covered just under 77% of the costs of the DI program.

OASI “Trust Fund”

The Old-Age and Survivors “Trust Fund” had $50,635 $48,559 million in taxes, $54,366 million in interest, and $52,290 million of outgo. That netted a monthly overall surplus of $54,366 million (worst June since 1994) or 49.20% of total revenue (worst June since 1999, prior to the latest realignment of the FICA/SECA taxes between the two “trust funds”), and a monthly primary deficit of $3,731 million (4th-worst month, outside the “double-payment” month of August 1990 and the transfer of revenues to the DI “Trust Fund” in November 1994, since monthly records were kept) or -7.68% of tax revenue (7th-worst “non-screwy” month since monthly records were kept).

The 12-month overall surplus was $108,910 million (worst since 9/1998-8/1999) or 15.93% of total revenue (worst since 5/1996-4/1997). Of note, the earlier dates were when less of the FICA/SECA tax was being directed to the OASI “Trust Fund” than currently.

The 12-month primary surplus was $375 million (worst outside the effects of the November 1994 transfer of revenues to the DI “Trust Fund”) or 0.07% of tax revenues (again the worst outside the effects of the November 1994 transfer of revenues to the DI “Trust Fund”). Of note, the two worse 12-month periods for the OASI saw a change of +$112 million (+0.04% of tax revenue) between 10/1994 and 9/1995 and -$825 million (-0.28% of tax revenue) between 11/1994 and 10/1995 due to that transfer to save the DI “Trust Fund”.

Tax revenues keep on sliding

The conditions of the “Trust Funds” are bad enough. However, that’s not the worst of the immediate news. Based on what the taxes taken in for the purposes of Social Security (FICA, SECA, and taxation of benefits) had been for the first 5 months of this year compared to the first 5 months of last year, Social Security tax revenues should have been around $58,540 million, or about 4.63% lower than the $61,383 million collected in June 2009. Instead, only $56,808 million came in to Social Security’s coffers in June 2010, a 7.45% drop from June 2009. That also was an overestimation of 2.96% on my part.

On the bright side, the outgo of $63,308 million was slightly less than my estimate of $63,984 million. I missed it by a mere 1.06%.

Revisions/extensions (6:36 pm 7/13/2010) - Corrected the characterization of the 12-month OASI primary change. It’s not until this month that it will go into the red. Also, added the “Economy Held Hostage” category that Shoebox started up earlier today.

R&E part 2 (8:18 pm 7/14/2010) - I somehow listed my spreadsheet estimate of taxes taken into the OASI fund instead of the Treasury figures. Sorry about that.

Economy Held Hostage – More Evidence

by @ 15:23. Filed under Economy Held Hostage, Politics - National.

The hits, they just keep a coming….

and finally….

The White house is trying to ease tensions with business.  While I’m not in the habit of providing my consultations for free, I will make this one exception.  President Obama, the solution is easy.  Businesses of all sizes want you to get off their backs and quit making up new regulations by the minute.  If you abide by those 2 simple rules, they’ll be OK.

July 12, 2010

American Economy Held Hostage

by @ 14:32. Filed under Economy, Miscellaneous, Politics - National.

On June 17th, Vice President Biden kicked off “Recovery Summer.”  If you missed it, Recovery Summer was designed to be a celebration of the massive surge of jobs that was to result from the implementation of the various stimulus projects.

Vice President Biden was the perfect mascot talking head for Recovery Summer in that just 2 months prior, he was touting how the Obama rejuvenated economy was soon to be generating 500,000 jobs a month.

So, how’s that recovery going for us? In just the past week we’ve seen:

  • June employment numbers that are worse than any sub retirement age individual has seen during their working life.
  • The Canadian dollar closing in on parity with the US dollar because the Canadians, a country of just 34 million people and an economy of just 1/10th of the US, generated 93,000 net jobs in June while the US economy could only generate 83,000 private sector jobs.
  • Even though the US Government was denied a reinstatement of their gulf drilling moratorium, the risk for drillers is so high that the moratorium is, for all practical purposes, in effect.  The first big drilling rig has left the gulf heading for more sure work in Egypt.

Not yet recognizing the impact of his agenda and choices on the US Economy, President Obama is rumored to be pushing Congress to pass both Cap and Tax and card check during what will surely be a lame duck session for the Democrats. While the negative impact of card check would be harder for most Americans to discern, Cap and Tax, by the administration’s own admission, would increase the costs for the average family by over $1,700 each year.

If it wasn’t clear before, there is no longer any doubt that the happy talk from the Obama administration about “job creation” and “an economic recovery” are just that, happy talk. It’s now clear that the American economy is being held hostage by the Obama administration and won’t be released until Obama has accomplished the redistribution of wealth that the far left has only managed wet dreams about since the days of FDR.

Note the new counter on the home page. We’ll be incrementing until the month that 500,000 net, private sector jobs are generated. Until then, we’ll be counting the days of the American Economy Held Hostage!

July 5, 2010

Monday Hot Read – Tom Blumer’s “The Most Depressing Numbers in Friday’s Employment Data”

by @ 6:27. Filed under Economy, Politics - National.

Tom Blumer explains why the June civilian labor force number justifies total depression:

The SA (seasonally-adjusted) number for June is bad enough. In fact, June’s seasonally adjusted workforce shrinkage is the largest for any June since 1963.

But the NSA (non-seasonally-adjusted) number representing what really happened is even worse. In a normal June, the workforce increases significantly, because lots of people occupied with other things during the rest of the year typically test the waters in the seasonal and summer-job market. But whereas an average of about 1.75 million did so during the past seven Junes, including almost 1.6 million last year during the recession, only 901,000 did so in June of 2010. You have to go all the way back to 1954 to find a worse June on the ground in the private sector than the June we just experienced. On a population-adjusted basis, June’s figure is the worst performance in the 63 years BLS has been tracking the data.

The only way anybody, especially Teh Won, can claim that we’re headed in the “right direction” with those numbers is if that person’s goal is to make everybody dependent on government.

June 24, 2010

So Obama is coming to town to talk economy

by @ 19:26. Filed under Economy, Politics - National.

The word from WisPolitics is that President Obama will be coming to a to-be-disclosed location in southeast Wisconsin on June 30 to talk about the economy. The lines are now open for suggestions on where he could hold that talk.

My choice – the being-torn-down former Delphi plant at Howell and Drexel in Oak Creek.

June 20, 2010

Those Who Do Not Learn From History….

by @ 12:15. Filed under Economy, Politics - National.

Is it just me or does President Obama’s hype around “Recovery Summer,” kicked off in this photo:

Feel an awful lot like how this event was received?

By the way, what’s the deal with the guy in the lab coat? Did the PR guys have some left over from the phony Doctor photo ops for Placebocare?

June 17, 2010

Expect the unexpected

by @ 9:21. Filed under Economy, Presstitute Follies.

If there’s bad economic news, in this case a sharp increase in weekly initial jobless claims to 472,000, one can count on the likes of Reuters to term it “unexpected”:

Jobless claims unexpectedly higher last week

The number of workers filing new applications for unemployment insurance unexpectedly rose last week as the manufacturing, construction and education sectors shed employees, adding to worries that the economic recovery is slowing.

(Revisions/extensions, 10:05 am 6/17/2010) – Hot Air commenter mankai found that the first version of AP’s story (thanks to Breitbart for not sending the original down the memory hole like everybody else) also used the “unexpectedly” adverb. Also, in the main post, Ed Morrissey noted that, thanks to a revision of the prior week’s claims, this week’s increase wasn’t exactly followed by 3 weeks of drops as the AP would lead one to believe.
Since Ed Morrissey decided to link here, and he has the most-exhaustive list of the press terming bad economic news “unexpected”, let’s count the number of times this year he’s caught the presstitutes using their favorite adverb:

This is hardly an exhaustive list, but that’s 22 “unexpected” bad-news items, another 2 “unexpected-by-another-phrase” bad-news items, and 2 “unexpected” good-news items. That’s an average of every other week.

May 18, 2010

Tuesday Hot Reads – a two-part American Thinker debt-bomb special

by @ 7:36. Filed under Economy, Politics - National.

If you’re not reading American Thinker, you are missing out on some of the brightest minds in political thought. Most outfits would put their “B-side” blog as their front page. A pair of posts from Monty Pelerin and Vasko Kohlmayer on the American debt bomb that is about to go off are prime examples of that. First, Mr. Pelerin on a possible doomsday scenario:

It is likely that Greece represents the prototype for early US responses. Political denial and cowardice will defer hard decisions. Eventually external forces will force action. The US government will become the same Pavlovian dog conditioned to respond to riots and violence. California is likely to be the first “trainer.” If the US government resists bailing out CA, then the streets of CA will be the learning center for the US Pavlovian dog. When (and I believe they will) the US government bails out CA, there is no end to the beggars that will show up. Eventually we run out of money, at least money that can be raised in financial markets. (We may be at this point already.)

My guess, and it is only that, is that the US government will do everything it can to avoid the necessary cuts and the resulting violence in the streets. That implies massive monetization to fund commitments. Ultimately that will destroy the currency and result in an hyperinflationary depression that will cause markets to cease to function other than on a barter system. Savings and fixed income pensions will be destroyed.

While printing money might buy some time, it will worsen outcomes, including worse violence. A hyperinflationary depression will destroy the country and perhaps our mode of government.

Somehow, I think that’s the goal. All the Boomers who are running things need to do is keep the plates spinning for another 20 years or so.

Next, Mr. Kohlmayer explains the nature of the public debt (link to Wikipedia removed as I don’t trust Wikipedia as far as I can throw it):

If anything, Intragovernmental Holdings – the part Mr. Hall terms “soft” – would be far more difficult to renege on than the other portion of the debt, since it concerns retirement money of Americans. One can well imagine the outrage that would erupt if one day politicians announced that we were going to simply “forget” about it. Given that senior citizens are electorally most potent demographic, no politician would ever dare to suggest that we do such a thing.

If any portion of the debt will ever get repealed it would be the Debt Held by the Public. Given that most Americans do not own government bonds, initially this form of default would directly affect only a comparatively small portion of the population. Much of the immediate loses would be, in fact, borne by foreign central banks and governments that hold US dollars as reserve currency. There would, of course, be much anger and protestations on their part. Politicians, however, would much prefer to face the wrath of foreigners than of their own citizens, since the Chinese cannot participate in our elections (or at least they are not supposed to)….

I do have to raise a point of order or two at this point. First, attempts by governments to renege on foreign-held debt have historically been met with war. Something tells me that the ChiComs aren’t simply going to walk away from north of $2 trillion, even in the “kinder, gentler” Third Millenium.

Second, that day of reckoning on the Intragovernmental Holdings is coming. It won’t affect those at or very near retirement, but those of my generation (the aptly-named GenX) are already being conditioned to accept that government won’t be there for us, even as we’re being told that we have to pay and pay and pay and pay for the lack of foresight on the part of our elders by not producing enough of us to keep the SocSecurity Ponzi scheme going while blindly depending on pensions that for the most part died before they got to use them.

The question is, will the publicly-held debt bomb explode before the Boomers die off? Something tells me that the proverbial spinning plates are already wobbling beyond stability.

Back to Mr. Kohlmayer for his close:

The dire nature of our fiscal situation has been recently pointed out by the International Monetary Fund which explicitly warned that the US national debt is soon to exceed 100 percent of GDP. The Fund cautioned that if nothing is done the figure will rise dramatically in the years ahead. Paradoxically, the IMF recommended that the amount by which the US needed reduce its structural deficits was greater than that recommended for Greece.

With the deficit projected to hit 10.6 percent of GDP this year and with long-term unfunded entitlement liabilities of some 104 trillion, the United States is indeed quickly becoming Greece on the Atlantic’s western shore.

Investors Are Morons

by @ 5:38. Filed under Economy.

So, I’m reading through an AP article about the DOW’s wild ride today and come across this sentence:

Investors are questioning whether steep budget cuts in countries including Greece, Spain and Portugal will hinder an economic recovery in Europe.

Do “investors” not understand that each and every dollar that is spent by any government is appropriated from the private sector somewhere?

Even after the experience of Obama’s “stimulus”, are “investors” still delusional enough to believe that government spending actually stimulates anything?

Do “investors” not understand that without dramatic changes in most government spending that nations one by one will see defaults?

Do “investors” not understand that their desire for increased government spending is simply satisfying a short term thrill for long term, significant pain?

Real investors understand each of the items I outlined.  However, the bunch of government, teat sucking sycophants that operate wall street don’t.  Those “investors” are morons!

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