Economy

Per Capita Federal Spending Up Sevenfold Since 1941

Real per capita federal spending has increased more than sevenfold since fiscal 1941, which concluded on June 30 of that year — or about five months before the Japanese bombed Pearl Harbor. In fiscal 1941, real per capita federal spending was approximately $1,718. In fiscal 2017, which concluded at the end of September, it was about $12,239. Back in 1941, at the beginning of Franklin Delano Roosevelt’s unprecedented third presidential term, the federal government spent $13,653,000,000, according to the White House Office of Management and Budget. Although that was a massive increase from the $4,598,000,000 the federal government had spent in 1933, when Roosevelt first took office, it was a pittance compared to what it would spend in the years to come. The national population was about 133,402,471 in 1941, according to the Census Bureau, which means the approximately $13,653,000,000 shoveled out by the Treasury that year equaled $102.34 per capita. Converted into September 2017 dollars using the Bureau of Labor Statistics’ inflation calculator, that equals $1,718.33 in real per capita federal spending. Over the next four years, as the United States fought a world war in both Europe and the Pacific, real per capita spending understandably escalated. In fiscal 1945, at the height of the war, federal spending hit $92,712,000,000 while the national population reached 139,928,165. Per capita spending that year was $662.57 or $9,035.08 in 2017 dollars. Federal spending initially tailed off after the war, but it did not return to prewar levels. By fiscal 1948, it was down to $29,764,000,000. With the population at 146,631,302, that equaled about $202.99 in per capita spending or $2,078.91 in 2017 dollars. That $2,078.91 in real per capita spending in fiscal 1948 was still $360.58 (or about 21 percent) higher than the real per capita spending of $1,718.33 in fiscal 1941. In fiscal 2017, the federal government spent $3,982,000,000,000, according to the Congressional Budget Office’s Monthly Budget Review. With the Census Bureau estimating that the population was 325,344,115 as of July, that makes per capita federal spending in fiscal 2017 about $12,239.35. That is $3,204.27 (or about 35 percent) higher than the $9,035.08 in real per capita spending in fiscal 1945 — at the height of World War II. It is more than seven times greater than the $1,718.33 in real per capita spending the federal government did in fiscal 1941 — the last fiscal year before World War II. Measured against the population of the country, the federal government is now seven times bigger than it was when FDR started his third term. Is it seven times better? What are Americans getting for this massive increase in the federal government?

Some really good questions…  To read the answer to those questions, and the rest of the article, click on the text above.  Our federal government is WAY too big and out of control.  We need to demand from our federally elected officials that they reduce the size and scope of the federal government, and return to a more “limited government.”  Of course, one way to do that is to make massive tax cuts.  After all, the money we send to Washington, D.C. is their source of power….over us.  So, next time there is an election, vote for that candidate who will cut your taxes the most.

Unemployment claims fall to lowest level in 43 years, despite hurricanes

The total number of laid-off workers receiving unemployment benefits fell to 1.89 million at the end of September, the Department of Labor reported Thursday, the lowest such mark in nearly 44 years. And new claims for unemployment benefits dropped 15,000 to 243,000 in the first full week of October, according to the agency, as the job market bounces back from hurricane damage even faster than forecasters expected. Low new jobless claims are a good sign. They indicate that layoffs are rare, and accordingly that job creation is strong. Unemployment benefits are available for up to 26 weeks in most states. Fewer people are now receiving benefits of all duration than at any time since December of 1973, when the total workforce was much smaller. That is a reflection of the strength of the jobs market, and the availability of new positions for laid-off workers. Prior to the landfall of Hurricanes Harvey, Irma, and Maria, claims had been running at ultra-low rates. With Texas and Florida now recovering, new claims again appear to be sinking to levels that indicate robust job creation. First-time claims in the states most affected by the storms are still high, but have fallen in recent weeks. “The data suggest that payrolls will bounce back quickly after last month’s hurricane-related weakness and that the underlying trend in employment growth remains strong — more than strong enough to keep the unemployment rate declining,” noted Jim O’Sullivan, chief U.S. economist for High-Frequency Economics. Economists calculate that new claims below the 300,000 mark indicate that unemployment will remain stable or fall. Good claims numbers, which are released weekly, are one of the factors that will reassure officials in the Trump administration and at the Federal Reserve that the jobs recovery is intact, even though the hurricanes generated net job losses in September. Minutes from the Fed’s September monetary policy meeting, released Wednesday, suggested that the central bank still sees the economy as healthy enough to justify raising rates again this year.

..which of course kinda stinks if you’re wanting to buy a new car or home.   But, otherwise, this is overall great economic news!!   🙂

63.1%: Participation Rate Reaches Trump-Era High; Record Number of Employed

Hurricanes Harvey and Irma are long gone, and despite dire predictions, they did not dampen the September jobs report in most key areas. The Bureau of Labor Statistics on Friday said the labor force participation rate of 63.1 percent reached a high for the year in September, up two-tenths of a point from August. The number of employed Americans reached 154,345,000 in September, setting a sixth record since January. As the number of employed Americans reached an all-time high, the number of unemployed Americans in September — 6,801,000 — hasn’t been this low since May 2007. The already low unemployment rate dropped another two-tenths of a point to 4.2 percent last month. That is the lowest since early 2001. BLS noted that the recent hurricanes had “no discernible effect on the national unemployment rate.” The number of Americans not in the labor force declined a bit in September to 94,417,000. The record, set in the final full month of the Obama presidency, stands at 95,102,000 Americans not in the labor force.

Some excellent news!!  Sure there are some mixed stats.   But, on balance, Americans have much to be optimistic about in this Trump economy.  To read the rest of this article, click on the text above.

Feds Collect Record Taxes Through August; Still Run $673.7B Deficit

The federal government collected record total tax revenues through the first eleven months of fiscal 2017 (Oct. 1, 2016 through the end of August), according to the Monthly Treasury Statement. Through August, the federal government collected approximately $2,966,172,000,000 in total tax revenues. That was $8,450,680,000 more (in constant 2017 dollars) than the previous record of $2,957,721,320,000 in total tax revenues (in 2017 dollars) that the federal government collected in the first eleven months of fiscal 2016. At the same time that the federal government was collecting a record $2,966,172,000,000 in tax revenues, it was spending $3,639,882,000,000—and, thus, running a deficit of $673,711,000,000. Individual income taxes have provided the largest share (47.9 percent) of federal revenues so far this fiscal year. From Oct. 1 through the end of August, the Treasury collected $1,421,997,000,000 in individual income taxes. Payroll taxes provided the second largest share (35.9 percent), with the Treasury collecting $1,065,751,000,000 in these taxes. The $233,631 in corporate income taxes collected in the first eleven months of fiscal 2017 equaled only 8.6 percent of total tax collections. The $21,172,000,000 collected in estate and gift taxes equaled only 0.71 percent of total taxes collected this fiscal year. (Tax revenues were adjusted to constant 2017 using the Bureau of Labor Statistics inflation calculator.)

BOOM! American Manufacturing Expanded in August at Fastest Pace in Six Years

American factories accelerated in August at the fastest pace of expansion since 2011, data from the Institute for Supply Management showed Friday. The ISM purchasing manufacturers surveyed showed all six of the biggest manufacturing industries ramped up activity in August. The monthly purchasing managers index rose 2.5 points to 58.8, reflecting employment rising to its highest level since June of 2011, an increase in production and rising inventories. Economists had expected a reading of 56.5. Any reading over 50 indicates growth. Exports and new orders continued to show strong growth, although these slowed from July. The Bureau of Labor Statistics said on Friday that manufacturing employment increased the most since 2012. The sustained gains in manufacturing reflect rising consumer spending and business investment. The ISM number from Friday suggests that third quarter economic growth may be greater than previously thought. Some economists believe that the economy could be growing at a four percent pace right now.

How great would that be?!?  More great news in this new Trump economy!  Excellent!    🙂

Feds Collect Record Income and Payroll Taxes Through July

The federal government collected record amounts of both individual income taxes and payroll taxes through the first ten months of fiscal 2017 (Oct. 1, 2016 through the end of July), according to the Monthly Treasury Statement. Through July, the federal government collected approximately $1,312,691,000,000 in individual income taxes. At the same time, it collected $976,278,000,000 in Social Security and other payroll taxes. Prior to this year, fiscal 2015 held the record for individual income tax collections through July. That year, the Treasury collected $1,309,431,860,000 (in constant 2017 dollars) in individual income taxes in the first ten months of the fiscal year. Last year (fiscal 2016), individual income tax collections from October through July dropped to $1,293,490,000,000 (in constant 2017 dollars). This year’s record of $1,312,691,000,000 in October-to-July individual income taxes is $3,259,140,000 more than the 2015’s previous record of $1,309,431,860,000. Before this year’s record $976,278,000,000 in October-through-July payroll tax collections, fiscal 2016 held the record at $948,709,020,000 (in constant 2017 dollars)—or about $27,568,980,000 less than this year. Overall federal tax collections in the first ten months of fiscal 2017 were $2,739,861,000,000. Yet that did not the record for October-through-July total federal tax collections. In the first ten months of fiscal 2015, the Treasury collected $2,741,079,280,000 (in constant 2017 dollars) in total taxes. That was $361,218,280,000 more than this year.

Wow..  For more of this exhausting report, click on the text above.

In Trump Era, U.S. Corporations See Best Earnings in 13 Years

As President Trump’s administration enters the last half of its first year, U.S. corporations are experiencing their best earnings in 13 years, a report finds. Bloomberg reports that U.S. corporate profits in the second quarter “have beaten estimates at more than three-quarters of the Standard & Poor’s 500 member companies. In every sector, at least half of the companies have surpassed or met expectations, with many also getting a boost from a sinking U.S. dollar.” “Growth was particularly strong in key regions of North America and Europe, where we grew sales greater than twice GDP, as well as throughout Asia-Pacific,” Dow Chief Executive Officer Andrew Liveris said. Europe supported U.S. growth during the first three months of this year, but during the second three months, emerging markets came in strong for U.S. earnings. Mark Luschini of financial service company Janney Montgomery Scott told Bloomberg that multinational corporations are seeing growth and higher earnings in both the U.S. and overseas operations. Bloomberg reported: ” Of the 454 companies in the S&P 500 that have so far reported second-quarter results, 68 percent have beaten analysts’ average estimates for revenue, and 78 percent have topped per-share earnings expectations, according to data compiled by Bloomberg. Earnings rose an average of 9.8 percent, while sales have climbed 5.5 percent.” Indeed, even as U.S. prospects rise, so has that of much of the world’s economy. “More of the global economy is participating in this recovery simultaneously, and that’s what shows up in the top-line results, particularly in technology,” said Jim Paulsen, chief investment strategist at Leuthold Group. The health care and banking sectors have also seen great growth. Analysts expect this growth to continue into the third quarter.

Agreed!!  And we look forward to it!    🙂