Wednesday Morning Rant

No, not Halloween. With the election right around the corner and Election Math everywhere - EV projections, polling changes, early vote tallies, registration and turnout deltas, ad nauseam - another routine event has fallen more or less by the wayside as it always does, election year or not. And since Election Math makes my brain (and stomach) hurt, there's another kind that is always appropriate at this time of year: fiscal.

Yes, the United States' Federal Fiscal Year 2024 is now done and dusted and the US Treasury has published its final Monthly Treasury Statement (MTS) of the fiscal year. It's pretty harrowing stuff. At the top of it is the simple imbalance. Money in last year: $4.919 trillion. Money out last year: $6.752 trillion. The deficit was $1.83 trillion, and receipts covered a scant 72.8% of spending.

But top-line figures are only skin deep. Where's the money going? Four places, in essence: medical services, Social Security, interest and the military. Medical services ("Health" plus Medicare plus VA) took $2.11 trillion net, Social Security took $1.461 trillion, which isn't as bad as it looks because it is directly funded by its own tax that is nearly big enough to cover it. It was funded at about 85%. Social Security is in deficit, but doing better than the government as a whole. Unpopular as it would be, it could be fixed.

The medical services deficit is another story. Like Social Security, Medicare also has a dedicated revenue stream. A revenue stream that covers a laughably small amount of the total. Revenues off the Medicare tax amounted to $0.387 trillion. CMS spent a total of $2.222 trillion (there's some moving of money from one pocket to another so it nets out lower, but that's the gross spending). CMS is funded at just 17.4%. Its deficit of $1.835 trillion looks pretty familiar - it's the federal deficit. The entire federal deficit. And that insurmountable problem explains much in the rest of the budget.

It puts a lot of corruption into perspective. That "green" cash cannon that Ace wrote about on Monday is a nothingburger in comparison. $27 billion is real money. It is, in fact, staggering. It's about 25% of the entire US Department of Transportation budget and about 37% of the entire HUD budget. It's about 7.6x more than the amount spent on the National Park Service and double what Trump wanted for a border wall and better enforcement (which was, of course, the one thing the Dems argued that we can't afford). It's real money, and it appears that the lion's share was skimmed off for cronies - but that huge multi-year sum amounts to just 1.5% of CMS' single-year deficit. It's a drop in the bucket.

All of that "chump change" adds up fast, but if you were to zero all of it, you will find that it is still a rounding error on the total problem. Why do they feel like they can get away with stealing nearly $30 billion on one program? Because they can. Nobody will even notice unless they bother to look. Curtailing that is right, proper and necessary - but it can't "move the needle" on spending. Not in comparison.

And there's also no downside to engaging in such brazen corruption, not personally and not otherwise. They get rich, the Party takes care of its own and the real problems remain so stupendous that their cronyism is easily lost as noise. It's big money to your or me, but not to a federal government running nearly a 30% deficit. And by the time that becomes the deciding factor, none of it matters anyway because that means the state is bouncing checks and it's every Party Man for himself.

Terrifying as it is, "keep partying until the money's all gone" has clearly become the rule of the day..

posted by Joe Mannix at 11:00 AM

| Access Comments