Saturday, May 19, 2012

Federal Spending 101 - The Entitlement Bomb

This post quickly details everything you need to know about our federal spending Entitlement Bomb.

If we do not reduce our entitlement spending we WILL, 3 to 20 years from now, experience the very same entitlement driven fiscal collapse which Greece is now experiencing.

First, click here & examine the deficit spending trends since 1970.

Next, quoting The non-partisan Congressional Budget Office:
“under any plausible scenario, the federal budget is on an unsustainable path—that is, federal debt will grow much faster than the economy over the long run... Federal spending on programs other than Medicare, Medicaid, and Social Security— including national defense and a wide variety of domestic programs—is likely to contribute far less, if anything, to the upward trend in federal outlays as a share of GDP”
The remaining images are all taken from two CBO documents published in April of 2012 detailing federal spending for fiscal year 2011. These documents demonstrate that, as the CBO previously asserted, virtually ALL of the growth (as a % of GDP) in federal spending over the last 20 years came from Medicare and Medicaid.

Click here and here for the two CBO documents.

Mandatory Spending = All federal government entitlements.
Mandatory Spending + Net Interest consumed 96% of all tax revenues!
Click the image & examine federal spending in 2011:

Click the image & examine federal spending in 2011
Click here for the source
(The non-partisan Congressional Budget Office.)


Between 1991 & 2011, Mandatory Spending as a % of GDP increased from 10.1% of GDP to 13.6% of GDP. Divide 13.6 by 10.1 and we find a 35% increase in Mandatory Spending over the prior 20 years:

Click the image & glance at Mandatory Spending from 1991 to 2011:
Click the image & glance at Mandatory Spending from 1991 to 2011
Click here for the source
(The non-partisan Congressional Budget Office.)


Click the image & examine trends in Mandatory Spending.
Note that Medicare & Medicaid dominated the increases:

Click the image & examine trends in Mandatory Spending from 1991 to 2011
Click here for the source
(The non-partisan Congressional Budget Office.)


Click the image & examine detailed Mandatory Spending in 2011:
Click the image & examine detailed Mandatory Spending in 2011
Click here for the source
(The non-partisan Congressional Budget Office.)


Between 1991 & 2011, Discretionary Spending as a % of GDP remained flat and defense spending DROPPED by 13%. Had Obama not wasted $800 billion on his so-called “stimulus” fiasco (which, demonstrably, made matters FAR WORSE), Discretionary Spending would have DECREASED by 6%.

Click the image & glance at Discretionary Spending in 2011:
Click the image & glance at Discretionary Spending in 2011
Click here for the source
(The non-partisan Congressional Budget Office.)


Click the image & examine trends in Discretionary Spending:
Click the image & examine trends in Discretionary Spending
Click here for the source
(The non-partisan Congressional Budget Office.)


Click the image & examine detailed Discretionary Spending in 2011:
Click the image & examine detailed Discretionary Spending in 2011
Click here for the source
(The non-partisan Congressional Budget Office.)

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