US Federal Debt since the Founding

The United States federal government began with a substantial debt, the cost of the Revolutionary War. Under Alexander Hamilton’s funding system the debt was paid off by 1840. Government debt has typically peaked after wars. It breached 30 percent of GDP after the Revolutionary War, the Civil War, and World War I. It breached 100 percent of GDP in World War II. Government debt also breached 100 percent of GDP in the aftermath of the financial crisis of 2008.

Gross Federal Debt vs. Net Debt

The US federal government differentiates between Gross Debt issued by the US Treasury and Net Debt held by the public. The numbers on Gross Debt are published by the US Treasury here.

Numbers on various categories of federal debt, including Gross Debt, debt held by federal government accounts, debt held by the public, and debt held by the Federal Reserve System, are published every year by the Office of Management and Budget in the Federal Budget in the Historical Tables as Table 7.1 — Federal Debt at the End of the Year. The table starts in 1940. You can find the latest Table 7.1 in here.

The chart above shows three categories of federal debt.

1. Monetized debt (blue), i.e., federal debt bought by the Federal Reserve System

2. Debt held by the federal government (red) e.g., as IOUs for Social Security

3. Other debt (green), i.e., debt in public hands, including foreign governments.

http://www.usgovernmentspending.com/federal_debt_chart.html

http://www.federalbudget.com/

FINANCIAL MANAGEMENT SERVICE
                                                  STAR - TREASURY FINANCIAL DATABASE
             TABLE 1.  SUMMARY OF RECEIPTS, OUTLAYS AND THE DEFICIT/SURPLUS BY MONTH OF THE U.S. GOVERNMENT (IN MILLIONS)

                                                        ACCOUNTING DATE:  10/12

   PERIOD                                                                     RECEIPTS                OUTLAYS    DEFICIT/SURPLUS (-)
+  ____________________________________________________________  _____________________  _____________________  _____________________
   PRIOR YEAR

     OCTOBER                                                                   163,072                261,539                 98,466
     NOVEMBER                                                                  152,402                289,704                137,302
     DECEMBER                                                                  239,963                325,930                 85,967
     JANUARY                                                                   234,319                261,726                 27,407
     FEBRUARY                                                                  103,413                335,090                231,677
     MARCH                                                                     171,215                369,372                198,157
     APRIL                                                                     318,807                259,690                -59,117
     MAY                                                                       180,713                305,348                124,636
     JUNE                                                                      260,177                319,919                 59,741
     JULY                                                                      184,585                254,190                 69,604
     AUGUST                                                                    178,860                369,393                190,533
     SEPTEMBER                                                                 261,566                186,386                -75,180

       YEAR-TO-DATE                                                          2,449,093              3,538,286              1,089,193

   CURRENT YEAR

     OCTOBER                                                                   184,316                304,311                119,995

       YEAR-TO-DATE                                                            184,316                304,311                119,995

The unfunded liability is the amount we have promised in benefits, looking indefinitely into the future, minus the payroll taxes and premiums we expect to collect. It’s the amount we must have in the bank today, earning interest, for these entitlement programs to be solvent.

Read more: http://www.politico.com/news/stories/0412/75603.html#ixzz2DRkCo9CU

Another soaring deficit puts added pressure on President Barack Obama and Congress to seek a budget deal in the coming weeks.

The Treasury Department said Tuesday that the October deficit — the gap between the government’s tax revenue and its spending — was 22 percent higher than the same month last year.

Tax revenue increased to $184.3 billion — 13 percent greater than the same month last year. Still, spending also rose to $304.3 billion, a 16.4 percent jump. The budget year begins on Oct. 1. Officials said last year’s figures were held down by a quirk in the calendar: the first day of October fell on a Saturday, which resulted in some benefits being paid in September 2011.

The deficit, in simplest terms, is the amount of money the government has to borrow when revenues fall short of expenses. The government ran a $1.1 trillion annual budget deficit in fiscal year that ended in September. That was lower than the previous year but still painfully high by historical standards.

Obama’s presidency has coincided with four straight $1 trillion-plus deficits — the first in history and record he had to vigorously defend during his successful re-election campaign.

The size and scope of this year’s deficit will largely depend on what happens with the so-called fiscal cliff — a package of tax increases and spending cuts set to take effect in January unless the White House and Congress reach a budget deal by then.

If the economy goes over the fiscal cliff, this year’s deficit would shrink to $641 billion, according to the Congressional Budget Office. But the CBO also warns that the economy would sink into recession in the first half of 2013.

If the White House and Congress can reach a budget deal that extends the tax cuts and avoids the spending cuts, the deficit will end up roughly $1 trillion for the budget year, the CBO says.

The deficits have been growing for more than a decade but reached a record $1.41 trillion in 2009, Obama’s first year in office. That was largely because of the worst recession since the Great Depression. Tax revenue plummeted during the downturn, while the government spent more on stimulus programs.

The deficits first began to widen after President George W. Bush won approval for broad tax cuts and launched wars in Afghanistan and Iraq.

One of the biggest challenges for the federal budget is the aging of the baby boom generation. That is raising government spending on Social Security and on Medicare and Medicaid. At the same time, the fragile economy, along with tax cuts, has reduced government revenue.

Over the past three years, revenue has fallen below 16 percent of the total economy as measured by the gross domestic product. Spending has exceeded 22 percent of GDP. The government has been forced to borrow to make up the gap, which has pushed the federal debt to $16.2 trillion.

The government is expected to hit its borrowing limit of $16.39 trillion by the end of December, unless Congress votes to raise it again. …”

http://www.foxnews.com/politics/2012/11/13/us-government-runs-120-billion-october-deficit/

Read more: http://www.foxnews.com/politics/2012/11/13/us-government-runs-120-billion-october-deficit/#ixzz2DRXL3c6c

“…Therefore, the most accurate way to measure the debt by President is to sum all the budget deficits. That’s because the President is responsible for his budget priorities. It takes into account spending, and anticipated revenue from proposed tax cuts or hikes.

There are a few caveats, however. First, Congress does have a role, since it must approve the budget. Second, each President inherits a previous President’s policies. For example, every President has had to compensate for lower revenue thanks to President Reagan’s tax cuts. That’s because tax increases are a sure way to prevent re-election.

Third, while every President has had to deal with a recession, all recessions were not created equal. Furthermore, some Presidents have had to deal with unusual events, like the 9/11 terrorist attack and Hurricane Katrina. While these weren’t part of the business cycle, they required responses that came with economic price tags.

President Obama contributed the most to the debt, with cumulative deficits totaling $5.073 trillion in just four years. Obama’s budgets included the economic stimulus package, which added $787 billion by cutting taxes, extending unemployment benefits, and funding job-creating public works projects. The Obama tax cuts added $858 billion to the debt over two years. Obama’s budget included increased defense spending to around $800 billion a year. Federal income was down, thanks to lower tax receipts from the 2008 financial crisis.Both Presidents Bush and Obama had to contend with higher mandatory mandatory spending for Social Security and Medicare. He also sponsored the Patient Protection and Affordable Care Act, which was designed to reduce the debt by $143 billion over 10 years. However, these savings didn’t show up until the later years.

President Bush is next, racking up $3.294 trillion over two terms. He responded to the attacks on 9/11 by launching the War on Terror. This drove military spending to a new records, between $600-$800 billion a year. President Bush also responded to the 2001 recession by passing EGTRRA and JGTRRA, otherwise known as the Bush tax cuts.

President Reagan added $1.412 trillion to the debt during his two terms. He fought the 1982 recession by cutting the top income tax rate from 70% to 28%, and the corporate rate from 48% to 34%. He also increased government spending by 2.5% a year. This included a 35% increase in the defense budget, and an expansion of Medicare. Although $1.412 trillion doesn’t sound like a lot, compared to 2012 debt levels, in fact Reagan’s economic policies doubled the debt during his Presidency.

President George H.W. Bush added $1.03 trillion to the debt in one term. He responded to Iraq’s invasion of Kuwait with Desert Storm. He oversaw the $125 billion bailout to end the 1989 Savings and Loan crisis. Part of his debt contribution was due to lost tax revenue from the 1991 recession.

Although many other Presidents added to the debt, none comes close to these four in terms of overall spending. Part of that is because the U.S. economy, as measured by GDP, was so much smaller for other Presidents. For example, in 1981 GDP was only $3 trillion, growing by five times to $15 trillion in 2012. See the table below for a year-by-year detail of each President’s budget deficit since President Woodrow Wilson. (Updated September 12, 2012)

President Barack Obama: First Term = $5.073 trillion.

• FY 2013 – $901 billion.
• FY 2012 – $1.327 trillion.
• FY 2011 – $1.299 trillion.
• FY 2010 – $1.546 ($1.293 trillion plus $253 billion from the Obama Stimulus Act that was attached to the FY 2009 budget).

President George W. Bush: First Term = $1.267 trillion. Second Term = $2.027 trillion. Total = $3.294.

• FY 2009 – $1.16 trillion. ($1.416 trillion minus $253 billion from Obama’s Stimulus Act)
• FY 2008 – $458 billion.
• FY 2007 – $161 billion.
• FY 2006 – $248 billion.
• FY 2005 – $318 billion.
• FY 2004 – $413 billion.
• FY 2003 – $378 billion.
• FY 2002 – $158 billion.

President Bill Clinton: First Term = $496 billion. Second Term = ($559 billion surplus). Total = ($63 billion surplus).

• FY 2001 – $128 billion surplus.
• FY 2000 – $236 billion surplus.
• FY 1999 – $126 billion surplus.
• FY 1998 – $69 billion surplus.
• FY 1997 – $22 billion.
• FY 1996 – $107 billion.
• FY 1995 – $164 billion.
• FY 1994 – $203 billion.

President George H.W. Bush: First Term = $1.03 trillion.

• FY 1993 – $255 billion.
• FY 1992 – $290 billion.
• FY 1991 – $269 billion.
• FY 1990 – $221 billion.

President Ronald Reagan: First Term = $733 billion. Second Term = $679 billion. Total = $1.412 trillion.

• FY 1989 – $153 billion.
• FY 1988 – $155 billion.
• FY 1987 – $150 billion.
• FY 1986 – $221 billion.
• FY 1985 – $212 billion.
• FY 1984 – $185 billion.
• FY 1983 – $208 billion.
• FY 1982 – $128 billion.

President Jimmy Carter: First Term = $253 billion

• FY 1981 – $79 billion.
• FY 1980 – $74 billion.
• FY 1979 – $41 billion.
• FY 1978 – $59 billion.

President Gerald Ford: Three Years = $181 billion.

• FY 1977 – $54 billion.
• FY 1976 – $74 billion.
• FY 1975 – $53 billion.

President Richard Nixon: First Term = $64 billion. First Year of Second Term = $6 billion. Total = $70 billion.

• FY 1974 – $6 billion.
• FY 1973 – $15 billion.
• FY 1972 – $23 billion.
• FY 1971 – $23 billion.
• FY 1970 – $3 billion.

President Lyndon B. Johnson: Two Years in First Term = $7 billion. Second Term = $35 billion. Total = $42 billion.

• FY 1969 – $3 billion surplus.
• FY 1968 – $25 billion.
• FY 1967 – $9 billion.
• FY 1966 – $4 billion.
• FY 1965 – $1 billion.
• FY 1964 – $6 billion.

President John F. Kennedy: Two Years in First Term = $11 billion.

• FY 1963 – $5 billion.
• FY 1962 – $7 billion.

President Dwight Eisenhower: First Term = $3 billion surplus. Second Term = $19 billion. Total = $16 billion.

• FY 1961 – $3 billion.
• FY 1960 – $0 billion (slight surplus).
• FY 1959 – $13 billion.
• FY 1958 – $3 billion.
• FY 1957 – $3 billion surplus.
• FY 1956 – $4 billion surplus.
• FY 1955 – $3 billion.
• FY 1954 – $1 billion.

President Harry Truman: First Term = $1 billion surplus. Second Term = $4 billion. Total = $3 billion.

• FY 1953 – $6 billion.
• FY 1952 – $1 billion.
• FY 1951 – $6 billion surplus.
• FY 1950 – $3 billion.
• FY 1949 – $1 billion surplus.
• FY 1948 – $12 billion surplus.
• FY 1947 – $4 billion surplus.
• FY 1946 – $16 billion.

President Franklin D. Roosevelt: First Term = $13 billion. Second Term = $11 billion. Third Term = $172 billion. Total = $196 billion.

• FY 1945 – $48 billion.
• FY 1944 – $48 billion.
• FY 1943 – $55 billion.
• FY 1942 – $21 billion.
• FY 1941 – $5 billion.
• FY 1940 – $3 billion.
• FY 1939 – $3 billion.
• FY 1938 – $0 billion (slight deficit).
• FY 1937 – $2 billion.
• FY 1936 – $4 billion.
• FY 1935 – $3 billion.
• FY 1934 – $4 billion.

President Herbert Hoover: First Term = $5 billion.

• FY 1933 – $3 billion.
• FY 1932 – $3 billion.
• FY 1931 – $0 billion (slight deficit).
• FY 1930 – $1 billion surplus.

President Calvin Coolidge: Two Years of First Term = $2 billion surplus. Second Term = $4 billion surplus. Total = $6 billion surplus.

• FY 1929 – $1 billion surplus.
• FY 1928 – $1 billion surplus.
• FY 1927 – $1 billion surplus.
• FY 1926 – $1 billion surplus.
• FY 1925 – $1 billion surplus.
• FY 1924 – $1 billion surplus.

President Warren G. Harding: Two Years of First Term = $2 billion surplus.

• FY 1923 – $1 billion surplus.
• FY 1922 – $1 billion surplus.

President Woodrow Wilson: First Term = $1 billion. Second Term = $21 billion. Total = $22 billion.

• FY 1921 – $1 billion surplus.
• FY 1920 – $0 billion (slight surplus).
• FY 1919 – $13 billion.
• FY 1918 – $9 billion.
• FY 1917 – $1 billion.
• FY 1916 – $0 billion (slight surplus).
• FY 1915 – $0 billion (slight surplus).
• FY 1914 – $0 billion.

FY 1789 – FY 1913 – $24 billion surplus. (Source: OMB, Table 1.1—Summary of Receipts, Outlays, and Surpluses or Deficits: 1789–2017) …”