2010-03-13

OSO's Debt Watch


GDP = $14.4617 Trillion (Current Dollar, 2009 Q4 second estimate)
Public Debt = $8.09178961632488 Trillion (2010-03-11)
Total debt owed to foreign holders of treasury securities = $3.689 trillion (2010-01-01)
Debt/GDP ratio = 55.95%
Foreign ownership of debt/GDP ratio = 25.51%
Population = 309,026,611 (Resident Population + Armed Forces Overseas, 2010-02-01)
GDP per capita = $46,797.59
Public Debt / person = $26,184.77
Foreign Public Debt/ person = $11,937.48
GDP per capita minus Public Debt per person = $20,612.82
Tax Receipts = $2.044117 Trillion (Twelve month moving average¹, Monthly Treasury Statement, 2010-02-01)
Tax Receipts as percentage of GDP = 14.13%
Debt/Receipt ratio² = 395.86%
Federal Government Outlays = $3.521637 Trillion (Twelve month moving average¹, Monthly Treasury Statement, 2010-02-01)
Federal Government Outlays as percentage of GDP = 24.25%
For every $1.00 the US government gains, it spends $1.72
Fiscal Surplus/Deficit = -$1.47752 Trillion
Surplus/Deficit as percentage of GDP = -10.22%

Notes:
  • Tax receipts for February 2010 were higher than in February 2009. The debt/receipt ratio of 395.86% is slightly better than the 396.59% recorded last week.
  • Federal government outlays were higher in February 2010 than in February 2009.
  • Added tax receipt and outlay as percentage of GDP to give an idea of the size of the US government in comparison to the rest of the economy.
  • Added GDP per capita figures (GDP ÷ population, which is one way of measuring GDP per capita) as well as "net worth" figures (GDP per capita minus public debt / person)
  • October 2008 figures below have been recalculated. Some figures have changed from previous debt watch posts - this was because I used approximations early on in this series. Links have been provided to the raw data I have used to come up with these figures. Feel free to fact check and let me know of any errors in the comments section.

In October 2008, GDP was $14.2003 Trillion (Current Dollar, 2008 Q4 final estimate)
In October 2008, Public Debt was $6.18964742400511 Trillion (2008-10-20)
In October 2008, the total debt owed to foreign holders of treasury securities was $2.9797 Trillion
In October 2008, the Debt/GDP ratio was 43.59%
In October 2008, the foreign ownership of debt/GDP ratio was 20.98%
In October 2008, the Population (resident population + Armed Forces overseas) was 305,554,049 (2008-10-01)
In October 2008, GDP per capita was $46,473.94
In October 2008, Public Debt / person was $20,257.13
In October 2008, Foreign Public Debt/ person was $9,751.79
In October 2008, GDP per capita minus Public Debt per person was $26,216.81
In October 2008, Tax Receipts were $2.578156 Trillion (Twelve month moving average¹, November 2008 Monthly Treasury Statement)
In October 2008, Tax Receipts represented 18.16% of GDP
In October 2008, the Debt/Receipt² ratio was 240.08%
In October 2008, Federal Government outlays were $2.747197 Trillion (Twelve month moving average¹, November 2008 Monthly Treasury Statement)
In October 2008, Federal Government outlays represented 19.35% of GDP
In October 2008, for every $1.00 the US government gained, it spent $1.07.
In October 2008, the Fiscal Surplus/Deficit was −$0.169041 Trillion
In October 2008 the Surplus/Deficit as percentage of GDP was -1.19%

The historical tables of the FY2010 budget (page 24-25) show that:

Highest tax receipts as percentage of GDP: 20.9% in 1944 and 2000.
Lowest tax receipts as percentage of GDP: 2.8% in 1932.
The last time tax receipts were lower than they are now: 13.3% in 1943.
Highest Federal Government outlays as percentage of GDP: 43.6% in 1943 and 1944.
Lowest Federal Government outlays as percentage of GDP: 3.4% in 1930.
The last time Federal Government outlays were higher than they are now: 24.8% in 1946.

¹ Measures total tax receipts/outlays over the previous 12 months from the last month measured. eg April 2009 to March 2010.
² The Debt/Receipt ratio measures government revenue (twelve month moving average) as a percentage of current public debt. A good way to compare it would be to compare your current income to what you owe on your mortgage.




8 comments:

Bruce Krasting said...

Why did you leave out the 4.5T of intergovernmentsal debt?

One Salient Oversight said...

I understand intergovernmental debt to be what the government "owes itself". In other words, funds get transferred from one government department to another.

One way to look at it would be to look at your own household debt - your household owes the bank $x. Your teenage son might owe you some money too, but because it is an inter-household debt, it doesn't affect what is owed outside.

I believe that a more judicial measure of debt is to measure what the government owes "the public", ie the market.

Bruce Krasting said...

The intergovernmental debt is now costing us $200b in interest a year. Would seem a mistake to leave that out in the equation.

In the example given you have to say that the parent can go to the Treasury with the IOU of the child and sell it for cash.

That is what happens with the IG debt. These obligations have the same standing as a t bill. They are full faith obligations. To default on these would be the same as defaulting on bonds owed by the Chinese.

You can't exclude 1/3 of our debt and then make comparisons. Bad mojo.

One Salient Oversight said...

The intergovernmental debt is now costing us $200b in interest a year. Would seem a mistake to leave that out in the equation.

But who is the interest paid to? It is paid from one part of government to another. If the government is paying $200b in interest per year in intergovernmental debt then it must logically be making $200b in interest per year. From an accounting perspective, the effect is neutral because money disappears from one US government bank account and then appears in another.

Probably a better example to use would be a divison of Microsoft borrowing money from another division of Microsoft. It doesn't affect Microsoft's external debt at all.

One Salient Oversight said...

From the treasury direct website:

What is the Debt Held by the Public?

The Debt Held by the Public is all federal debt held by individuals, corporations, state or local governments, foreign governments, and other entities outside the United States Government less Federal Financing Bank securities. Types of securities held by the public include, but are not limited to, Treasury Bills, Notes, Bonds, TIPS, United States Savings Bonds, and State and Local Government Series securities.


What are Intragovernmental Holdings?

Intragovernmental Holdings are Government Account Series securities held by Government trust funds, revolving funds, and special funds; and Federal Financing Bank securities. A small amount of marketable securities are held by government accounts.

Bruce Krasting said...

Okay. We don't agree. The debt held by the SSTF will be spent over the next decade. It will have to be paid back by taxpayers. Same taxpayers that borrow from Japan and China.

You will see that this issue is elevated in the next 12 months. When it is on the table the myth that the intergovermental account doesn't matter will be blown to pieces. It matters very much.

Rdan said...

Hi OSO.

I haven't been by in a long time. I see BK has been by to comment on intragovernmental debt (and SS by extension). He has changed his warning from 6 months from now to 12 months from now.

Anyways best to you,

Dan
Angry Bear

Bruce Krasting said...

Hello Rdan.

Yes this issue will be pushed off for another year. We have the November elections. This issue cant come up for discussion before that. That would mean the first time this can get on the agenda is 1Q 2011. Hell of a system we have.

By the way, did you see this? You, Coberly and Webb called me chicken little for making a warning on the TF two months ago. What do you call ABC News? More chicken little?

http://www.abc15.com/news/national/story/Social-Security-to-start-cashing-Uncle-Sams-IOUs/hmdsklnE80KcyZ59JZY7Zg.cspx