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I see no recent article topics related to my comment, so I'll post it here:
Reuters I'm an old retired accountant. Most members of Congress are lawyers who hire economists for financial advice. Degrees in law and economics require no study of accounting. None of them understand that there are huge accounting and reporting errors in Treasury reports that can't pass an audit, as confirmed by the current and former US Comptrollers General. Dave Walker and Eugene Dodaro both received their 4 year accounting degree soon after I received the same in 1970. They both started working at the GAO in the 1970s and have apparently thought 'It's just the way the accounting works at the Treasury'. Dave Walker doesn't understand that analysis of historical revenue and expenses requires filtering out, or 'seeing through', huge errors that back up false claims of "adequate revenue" and "too much spending on social programs". I would agree with Dave Walker if he said "Treasury interest expense spending it out of control". But he simply says 'Spending is out of control', which is misleading.
Accounting isn't rocket science - it's actually pretty simple if it is accurate. But the complex mess created by the Treasury is not easy to explain, or to understand. You might want to read one of my recent explanations that relates to DOGE - I think you will understand it. If not, you can ask me questions. I don't want to see the US government devolve into insolvency due to misinformation in Treasury reports:
Elon Musk is assuming that fraud, waste, and abuse have been causing deficits, rising debt, and rising Treasury interest expense payments. If there was any significant fraud, waste, and abuse it would show up in historical analysis of federal revenue and expenses. I have done that analysis:
As an accountant I have previously found fraud by analyzing abnormally high corporate expense account increases. Over the last several years I have examined historical US federal revenue and expenses as a % of GDP to determine why the US debt increased from 33% of GDP in 1980 to 123% in 2024, after decreasing from 120% in 1946 to 33% in 1980. Along the way I found many illusions that were created by LBJ's FY1969 "unified" budget and "consolidated' financial statements that should never have been "unified" or "consolidated". I will explain how the ongoing LBJ illusions are created if anyone reads this and requests the explanation. For now I will explain my conclusions:
Actual Treasury revenue is the total of income tax, corporate tax, excise tax and other tax. Actual revenue excludes all Social Security and other trust fund contributions that are borrowed by the Treasury and reported properly as Treasury debt increase. Actual revenue in FY 2023 was 10.5% of GDP. and 12.9% of GDP in 1980. The difference of 2.4% X 2023 GDP of $26,982 billion indicates a 2023 revenue deficiency of more than $640 billion. The $640+ billion revenue deficiency added to the borrowed 2023 deficit and debt balance causing Treasury interest expense to increase and also add $883 billion to deficits and debt.
Actual Treasury expenses exclude all trust fund benefit payments that are subtracted from the Treasury debt owed to the trust funds. Actual Treasury non-interest expenses totaled 14.5% of GDP in FY2023 and 14.2% in 1980. The difference of 0.3% X 2023 GDP of $26,982 billion indicates excess 2023 non-interest expenses of about $80 billion. The same comparison pre-pandemic in 2019 resulted in the same 14.2% of GDP in 2019 as in 1980. Further historical analysis indicates no significant annual excess non-interest expense spending as a % of GDP since 1980 on average.
Annual deficits and debt increases since 1980 have been mostly caused by borrowing huge revenue deficiencies while causing interest expense increases from $75 billion in FY1980 to $883 billion in FY2023 to $1,133 billion in FY2024.
The current $36 trillion of debt started to build up during the 12 years under Reagan and GHWB when the debt doubled as a % of GDP from 33% in 1980 to 66% in 1992, while the debt and interest costs quadrupled during those 12 years. Every subsequent administration has been forced to borrow the quadrupled interest costs, along with the ongoing revenue deficiencies created under Reagan and GHWB. More revenue deficiencies were created under GWB and Trump.
There can be fraud, waste, and abuse in any government, business, or even family entity, The only significant fraud, waste and abuse indicated by the historical Treasury reports and OMB data is due to 44 years of borrowing revenue deficiencies and 44 years of rising compound interest costs caused by borrowing the revenue deficiencies.
Eisenhower's 1960 budget was balanced and contained no "unified" budget illusions. LBJ's ongoing illusions of 'adequate revenue' and 'too much spending on trust fund social programs' continue to mislead everyone. Every trust fund has a surplus balance. No trust fund program has caused any Treasury revenue minus expense deficit.
I'm in NH. I have charts and spreadsheets that help with explaining why the US debt has increased from 33% in 1980 to 123% today. I want someone at Reuters to write an article about all of the above, and about way more misinformation I have found in Treasury reports. |
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