Mystery $1.5 Trillion

[inna]

Curious....

Any ideas/guesses what might be going on there?

June Deficit Fails To Account For $142 Billion In Excess June Borrowings;
U.S. Has Issued $1.5 Trillion Excess Debt Over Budget In Past 4 Years

Submitted by Tyler Durden on 07/13/2010 18:19 -0500
http://www.zerohedge.com/article/june-deficit-fails-account-142-billion-excess-june-borrowings-us-has-issued-15-trillion-exce

As we reported earlier, the June US budget deficit came in around as expected, at $68.4 billion. Yet an interesting observation that we have touched upon previously, is that over the same period, the US borrowed a whopping total of $210.9 billion. Once again, as has been the case over the past four years, the US borrowed far more in any deficit month, then it needed simply to close the deficit. Case in point, the June differential was $142.5 billion more borrowed than "needed", the YTD (fiscal) differential is $290 billion, and the cumulative differential since the beginning of the 2007 Fiscal year (October 2006), is a whopping $1.5 trillion. Over the past 3 years and 9 months, the US has accumulated an incremental $4.7 trillion in new debt, even as the budget deficit has grown by "only" $3.2 trillion. One wonders just what the reason for this differential is, which amounts to half the cumulative budget deficit over the same time period? The cumulative data, as well as the stunning differential between the two time series is presented on the attached chart.

My immediate thought was that they were "borrowing" from the Social Security Trust Fund, to pay for ongoing bankster bailouts.

Just a guess. :shrug:

[unhappycamper]

1. Politicians have been raiding the SS lockbox for a long time. n/t

[Statistical]

2. the govt has been borrowing from the SS surplus for two decades.

It doesn't require any special action.

SS has a surplus. The surplus is transferred to general account, and bond issue to trust for the value transferred.

It would make no sense to NOT BORROW from SS given our country has a national debt. If you think about it for a few minutes I am sure you will realize why.

[inna]

3. You missed the point.

Did you read the text?

The article doesn't say anything about SS, it was simply my guess that that's where they were borrowing from.

The curious part is the discrepancy (extra $1.5T) in bookkeeping/accounting, when amounts borrowed each month exceed deficit for that month and are not recorded as deficit. Sounds like an accounting trick to me, but... maybe it's completely trivial and there is nothing to it. :shrug:

Once again, as has been the case over the past four years, the US borrowed far more in any deficit month, than it needed simply to close the deficit.

Over the past 3 years and 9 months, the US has accumulated an incremental $4.7 trillion in new debt, even as the budget deficit has grown by "only" $3.2 trillion. One wonders just what the reason for this differential is, which amounts to half the cumulative budget deficit over the same time period?

[Statistical]

4. I did read the article I simply was pointing out that the SS claim is unrelated.

The US govt could have simply borrowed the "missing" money via public debt as well. The source of the funding is not indicated.

Obviously there is still a lot of off-book items in federal expenditures. Obama said he brought the wars back onto the books (bush was famous for keeping them off book to make deficit look smaller). Did he bring them completely on the books or are there some off-book expenses?

It is an interesting question however bringing SS into it adds nothing.

[Po_d Mainiac]

7. SS excess would be accounted for as a credit automatically

http://en.wikipedia.org/wiki/Social_Security_Trust_Fund

The Social Security Trust Fund is the means by which the federal government of the United States accounts for excess paid-in contributions from workers and employers to the Social Security system that are not required to fund current benefit payments to retirees, survivors, and the disabled or to pay administrative expenses.

More important, the trust fund also contains the securities that will be redeemed to make benefit payments in the future when contributions derived from payroll taxes and self-employment contributions no longer are sufficient to fully fund then-current benefit payments. (The controversy over its meaningfulness is a topic of the sustainability of the unified Federal budget.)

Paid-in contributions that exceed the amount required to fully fund current payments to beneficiaries are invested in securities issued by the federal government. The securities issued under this scheme constitute the assets of the Social Security Trust Fund. Because under current federal law these securities represent future obligations that must be repaid, the federal government includes these securities within the overall national debt.<1> The portion of the national debt that is not considered "publicly held" represents the obligations incurred by the government to itself, the bulk of which consists of the government's obligations to the Social Security Trust Fund.

[notesdev]

5. If I had to guess

I'd say this is to funnel extra T-bills to the Fed to replace their depleted stocks, which have been being used in various bailout/QE/swap-line games trying to keep kicking that can down the road.

[NoNothing]

6. Isn't there a simple explanation?

The government often spends more (total outlays) than is in the federal budget, because of various "emergency" or "supplementary" spending bills. So comparing what the government *actually* spends (and has to borrow for, when running a deficit) vs. what is published in the budget will always result in a discrepancy.