Submitted by Taps Coogan on the 16th of December 2019 to The Sounding Line.
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There are two general categories of federal government spending. The largest, ‘mandatory spending,’ represents nearly two thirds of all federal spending. It is comprised of an array of entitlement programs such as Social Security, Medicare, and Medicaid. It is called ‘mandatory spending’ because, in any given year, spending on entitlement programs is simply a function of how many people qualify for the benefits. Without amending the underlying legislation that created such entitlement programs, a political impossibility in most cases, Congress cannot influence annual mandatory spending levels. While there are occasional eligibility changes made to smaller entitlement programs like Food Stamps, they represent a tiny portion of overall spending. Food Stamps, for example, cost about $68 billion a year or 1.3% of federal spending. Total mandatory spending in Fiscal Year 2019 amounted to roughly $3.16 trillion (including the interest expense on the national debt, which is also mandatory).
The second category of government spending is ‘discretionary spending.’ It covers everything that Congress debates in the federal budget every year: defense spending, budgets for all the federal agencies like the EPA, NASA, and the FBI, spending on the Judicial branch and the Whitehouse, the prison system, research grants, foreign aid, spending on Congress itself, all of Congress’s wasteful pet projects, pork, and corruption, etc… Congress has discretion over such spending and can change it from year to year according to its political desires. Discretionary spending in fiscal year 2019 is estimated to have been $1.359 trillion.
Combined, mandatory and discretionary spending amounted to about $4.446 trillion in fiscal year 2019.
Meanwhile, the reported federal budget deficit was $984 billion. However, the reported deficit figure does not include off-budget spending from programs like student loan financing, running the Post-Office, and the circular funding scheme used by the Social Security ‘Trust Fund.’ The increase in the national debt in fiscal year 2019, the true budget deficit, was slightly more than $1.2 trillion.
In other words, the true deficit, the amount by which the national debt increased, was 88% as large as the entire discretionary budget that Congress debates. If Congress wanted to actually balance the budget that they have any real control over, they would have to nearly eliminate it.
As we noted a year ago, the same was true in 2018, and will likely be true every year for the foreseeable future. In essence, without entitlement reform or massive tax increases, all ‘discretionary’ federal spending would need to be cut in order to stop the increase in the national debt. That includes the entire military, the entire executive branch and all of its agencies, Congress, and the entire Judicial branch. Pretty much everything you can think of other than entitlement programs and servicing the national debt would have to go.
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