Economy , Newsline

CBO: Biden’s 2023 Deficit Soars 131%

Posted on Wednesday, August 16, 2023
by Outside Contributor
Joe Biden makes remarks to press about deficit
President Joe Biden delivers remarks on the deficit, in the Roosevelt Room of the White House.

Ten months into the 2023 fiscal year, a new budget deficit report is grim enough to make Joe Biden almost welcome discussion of his role in his son Hunter’s unseemly business activities.  

This week, the nonpartisan Congressional Budget Office (CBO) released its official monthly budget report, and the deficit has more than doubled since this same point one year ago.  Through July of last year, the deficit was $726 billion, but today it’s already $1.62 trillion.  

But for an accounting abnormality that shifted some 2023 spending back into 2022, the deficit would’ve been even worse:  

The federal budget deficit was $1.6 trillion in the first 10 months of fiscal year 2023, the Congressional Budget Office estimates – more than twice the shortfall recorded during the same period last year.  Revenues were 10 percent lower and outlays were ten percent higher from October through July than they were during the same period in fiscal year 2022.  Outlays in fiscal year 2023 were reduced by the shifting of certain payments – totaling $63 billion – from October 1, 2022 (the first day of fiscal year 2023), into fiscal year fiscal year 2022 because October 1 fell on a weekend. If not for those shifts, the deficit through July would have been $1.7 trillion (Emphasis added). 

Throughout his presidency, Biden has falsely and repeatedly bragged that, “I’ve already cut the deficit by $1.7 trillion in my first two years in office,” when even left-leaning PolitiFact rules that any reduction was an accounting phenomenon flowing from the natural expiration of emergency Covid spending.  

Indeed, it’s closer to the truth to say that the deficit would’ve been far worse had Biden been granted his full wish list.  Remember, Senator Joe Manchin (D – West Virginia) enraged Biden and the far left by refusing to support Biden’s original $3.5 trillion “Build Back Better” proposal.  

In any event, Biden owns far more responsibility for today’s skyrocketing deficit than he does for the anomaly of declining post-COVID deficits.  

First, Biden’s spending and regulatory choices, including his “Inflation Reduction Act” itself, triggered steep price inflation that has persisted throughout his presidency.  Although Biden regularly boasts about slowing inflation in the same deceptive manner that he boasts about reducing deficits, the fact is that it remains nearly three times as high as when he entered office.  

In order to battle inflation that Biden once dismissed as “transitory,” the Federal Reserve has had to raise interest rates.  Those higher interest rates not only punish consumers attempting to purchase homes or pay off their credit card debt, but they also deepen the deficit by raising the cost of paying interest on the federal debt.  “Net outlays for interest on the public debt,” the CBO emphasizes in its latest report, “rose by $146 billion (or 34 percent), mainly because interest rates are significantly higher than they were in the first 10 months of fiscal year 2022.”  

To put that in perspective, the $572 billion that we’ve spent on servicing the federal debt exceeds spending on Medicaid ($518 billion) and education ($251 billion), and nearly equals defense spending ($630 billion).  

Making matters worse, interest rates are still on the rise, and much of the fiscal 2023 spending to date occurred when interest rates were lower nearly a year ago.  Accordingly, it’s only going to get uglier between now and the end of this fiscal year on September 30.  

Secondly, Biden’s policies have slowed an accelerating economy that he inherited as America exited the 2020 COVID shutdowns.  In turn, that slowing economy has reduced incoming federal revenues due to more sluggish productive activity, as the CBO report acknowledges:  

In the May 2023 baseline, CBO projected that receipts would be lower this year than they were in 2022, but the decline has been larger than expected.  Receipts collected through July 2023, net of refunds, were about $300 billion less than CBO projected, mainly because of smaller-than-anticipated collections of individual and corporate income taxes.  The reasons for the difference will be better understood as additional information becomes available; one factor may be smaller collections of taxes on capital gains and other types of income.  

“Bidenomics” has thus slowed the U.S. economy, which in turn reduces incoming tax receipts, which in turn deepens the federal deficit.  

More broadly, Biden’s surging deficits will increasingly crowd out defense spending amid a more perilous geopolitical environment, and ultimately programs like Medicare and Social Security on which many Americans depend.  

While the conformist mainstream media slumbers and allows Biden to continue claiming to be a deficit-slashing president, the problem is rapidly increasing to alarming levels.  Unless he voluntarily changes his policy course or is forced to do so, the danger to Americans and our global allies will only continue to grow. 

Reprinted with Permission from – By Timothy H. Lee

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6 months ago

Missing from the article is the news that the Biden administration will be enacting new rules on how the CBO and other government agencies calculate deficits, regulations and true costs of legislative bills going forward. The Biden administration wants to get away from the standard cost / benefit analysis, which show the true costs of a new regulation or law and instead moves to a much more subjective global social benefit analysis that will rely on theoretical proposed cost savings decades into the future and even outside the United States. So, while a new regulation or law may be detrimental here in the United States, the federal government would be allowed to tout proposed economic or social benefits to another country as part of “cost savings”. Thus, all the reports coming from the CBO and other watchdog agencies in the future will be far less accurate and paint a far rosier picture of the impact of various regulations and new laws enacted. The Biden administration is trying to get these changes in place before the end of this year. This is our federal government folks. If we really even want to call it that at this point.

6 months ago

Well, I see the AMAC moderator is still censoring perfectly valid comments. Shame that he or she continues to allow trolls to post whatever they want on this site.

David Millikan
David Millikan
6 months ago

Why am I not surprised.
With Dictator Beijing biden’s INFLATION INCREASE ACT and SELLING OUT the USA we can expect it to get even higher as each day goes by.
See what happens with an Illegal and Unconstitutional so-called president who committed Election Fraud and continues with Election Interference FALSELY accusing President Trump of things that Dictator Beijing biden is personally GUILTY of.
As I said at the beginning..Why am I not surprised.

6 months ago

All house republicans should resign if they cannot set a balanced budget. All taxpayers should reduce their “due” tax paid by 10%. 1-2 million will not work. These will be locked up. ALL taxpayers which I estimate as 50 million ( only 15% of our population) will have to do this. 85% of the nation (illegals, umemployed, the worthless, the underpaid) pay no tax.

William Hancock
William Hancock
6 months ago

Now, Biden’s handlets have to get him to stop saying thar he cut the defi it. Good luck on that.

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