January 2nd, 2007

New Tilley Hat

The Nation's Fiscal Imbalance

The 2006 Financial Report of the US Government (172p PDF) From Financial Management Services of the Treasury Department, issued by the Secretary of the Treasury.

While we are unable to express an opinion on the U.S. government’s consolidated
financial statements, the following key items deserve emphasis in order to put the
information contained in the financial statements and the Management’s Discussion and
Analysis section of the 2006 Financial Report of the United States Government into
context. Despite improvement in both the fiscal year 2006 reported net operating cost and
the cash-based budget deficit, the U.S. government’s total reported liabilities, net social
insurance commitments, and other fiscal exposures continue to grow and now total
approximately $50 trillion, representing approximately four times the Nation’s total
output (GDP) in fiscal year 2006, up from about $20 trillion, or two times GDP in fiscal
year 2000. As this long-term fiscal imbalance continues to grow, the retirement of the
“baby boom” generation is closer to becoming a reality with the first wave of boomers
eligible for early retirement under Social Security in 2008. Given these and other factors,
it seems clear that the nation’s current fiscal path is unsustainable and that tough choices
by the President and the Congress are necessary in order to address the nation’s large and
growing long-term fiscal imbalance. [p 156]

Let me emphasis the conclusion: "the nation’s current fiscal path is unsustainable".

I wonder who will be fired next for telling the truth?

"Reality has a well-known liberal bias." -- Stephen Colbert, White House Correspondents' Association Dinner 4/29/06