The current U.S. fiscal situation in graphs

We will write about the current U.S. fiscal situation in depth later during the month but in the meanwhile here is the story in some graphs.

The total Federal debt (doesn’t include individual state debt) now stands at $21.52 trillion,

US federal government debt December 2018


Interest payments are soaring, with annualized interest payments now running at $555.58 billion,

US government interest payments

The fiscal deficit has been worsening and the last time the there was a budgetary surplus was in 2001,

US Net lending or net borrowing December 2018 US Net Federal Government Saving December 2018

Looking at government expenditure vs income,

US government expenditures and receipts actual December 2018

Expenditure is growing quicker than income,

US government expenditures and receipts percentage change December 2018

The graph below says is all, the expenditure to income ratio is currently 1.29 which means the U.S. government spends $1.29 for every $1 in income. And even though historically the government has spending more than it earns there is an acceleration in the ratio at the moment,

US government expenditure by receipts December 2018

The main cause of the rising ratio is falling tax receipts due to tax rate cuts,

US Federal government current tax receipts December 2018

… which are mainly down to falling corporate taxes given the deep tax rate cut,

US Taxes on corporate income December 2018

Custom Duties are up though given the trade war induced tariffs,

US customs duties December 2018

If the U.S. was a corporation (rather than a country/government) with persistent borrowing, ever increasing debt and expenditure running at a pace quicker than income in an environment of rising interest payments (and rates) it would probably be rated quite badly by the rating agencies. But, there you go, the U.S. in only amongst a handful of countries left with a AAA rating.

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