New Report Shows Federal Deficit is $200 Billion More Than Bush Stated In October
December 15, 2006
Rep Thompson: “We must bring honest and responsible spending back to Washington.â€
Today, Rep. Mike Thompson (D-Napa Valley) criticized the Bush Administration for downplaying a new report from the Treasury Department showing that the federal budget deficit is almost $200 billion more than what the president told us in October.
Thompson, a member of the Blue Dog Coalition, called the budgetary slight-of-hand “a serious disservice to the American taxpayer.” The Treasury Department's Financial Report, which was quietly released this afternoon, shows that the federal deficit is actually $450 billion rather than $248 billion, the amount announced by the president with significant fanfare two months ago. This discrepancy results from the government using two different accounting standards to calculate the deficit; the report issued in October is determined using cash-based accounting, whereas the second, less-publicized report issued today uses accrual-based accounting. Accrual-based accounting provides a more accurate picture of finances and is required of all U.S. business with revenues over $5 million.
“Whatever way you slice it, both of these numbers show that our nation's spending is out of control,” said Thompson. “Each year, these deficits get tacked on to the already outrageous national debt of $8.6 trillion, a debt our grandchildren's children will be dealing with.”
To put these numbers into perspective, Thompson noted that each American would need to pay nearly $29,000 to eliminate the national debt. In 2005, net interest payments on the national debt were $184 billion, which is triple all federal funding for education and six times the amount for either the environment or veterans' health care.
“Unfortunately, it's typically for this Administration to release this type of unflattering news on a Friday afternoon,” said Thompson. “We must bring honest and responsible spending back to Washington by re-instituting rules in Congress that make sure bills won't pass unless they're paid for.”
Thompson, a member of the Blue Dog Coalition, called the budgetary slight-of-hand “a serious disservice to the American taxpayer.” The Treasury Department's Financial Report, which was quietly released this afternoon, shows that the federal deficit is actually $450 billion rather than $248 billion, the amount announced by the president with significant fanfare two months ago. This discrepancy results from the government using two different accounting standards to calculate the deficit; the report issued in October is determined using cash-based accounting, whereas the second, less-publicized report issued today uses accrual-based accounting. Accrual-based accounting provides a more accurate picture of finances and is required of all U.S. business with revenues over $5 million.
“Whatever way you slice it, both of these numbers show that our nation's spending is out of control,” said Thompson. “Each year, these deficits get tacked on to the already outrageous national debt of $8.6 trillion, a debt our grandchildren's children will be dealing with.”
To put these numbers into perspective, Thompson noted that each American would need to pay nearly $29,000 to eliminate the national debt. In 2005, net interest payments on the national debt were $184 billion, which is triple all federal funding for education and six times the amount for either the environment or veterans' health care.
“Unfortunately, it's typically for this Administration to release this type of unflattering news on a Friday afternoon,” said Thompson. “We must bring honest and responsible spending back to Washington by re-instituting rules in Congress that make sure bills won't pass unless they're paid for.”
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