The following is an excerpt from Just The News.
A federal watchdog reported that Congress continues to spend more money than it collects in taxes.
The U.S. Government Accountability Office’s audit of the federal government’s financial statements found it “continues to face an unsustainable long-term fiscal path.”
In fiscal year 2022, the federal government spent $6.27 trillion and collected $4.9 trillion in revenue, resulting in $1.38 trillion deficit, according to the U.S. Treasury.
The federal government budget most recently had a surplus in 2001, one of five times it had a surplus in the last 50 years.
Daniel Smith, an economics professor at Middle Tennessee State University, said overspending at the federal level is no surprise.
“It has been known by economists and politicians for a while that our current level of spending is unsustainable,” he said in an email to The Center Square. “Our current debt to GDP ratio ranks the United States as one of the highest in the world. Most of the other countries in that category are not doing well economically. And, the United States’ debt is under-reported because it doesn’t include unfunded liabilities, which raises our debt to over $200 trillion.”
While the federal budget may have many decimal places, Smith said most Americans understand that “you can’t sustainably spend more than you earn.”
“Debt can be undertaken if it is used for productive investments, but is a bad idea for funding current consumption,” he said. “Most of what the U.S. is spending money on, of course, is current consumption (transfers), not productive investments.”
He also said the federal government is moving toward “a situation where debt service cost can potentially become the biggest budget item of the U.S. government.”
The U.S. Government Accountability Office’s 270-page financial audit also said it can’t opine on the accuracy of the government’s bookkeeping because of ongoing problems.
Among the problems: Long-standing financial management issues at the Department of Defense and inadequate accounting for transactions between government agencies.
It further outlined problems with the Small Business Administration’s pandemic relief programs, the Department of Education’s loan programs and $247 billion in improper payments. An improper payment is one that should not have been made or that was made in the wrong amount.
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