As you know, I am the sole proprietor of the most comprehensive and mandatory website on government spending in the United States. Even though Google Search downrated my site back in 2019. We are talking about usgovernmentspending.com.
The scientists and experts and economists at the Office of Management and Budget make some fearless forecasts about future federal spending -- and federal debt and GDP -- for the next five years when they issue the federal budget every year and hand it off to their pals at govinfo.gov.
A while back I wondered how well the scientists and experts and economists at the OMB were doing with their inflation forecasts. Yes, right there in the budget is “Table 10.1 -- Gross Domestic Product and Deflators Used in the Historical Tables” which, in every budget, includes a fearless inflation forecast going out five years. So I put a new chart on my US National Inflation Analysis page. It shows the inflation forecasts in the FY21, FY22, FY23, and FY24 budgets. Here it is.
Of course, you need to be a scientist or an expert or an economist to read the chart. So I will tell you what it says. It says that the folks at the OMB had no idea there would be inflation in our all-American future until the FY23 budget came out in March 2022. Really, you scientists and experts and economists… After the Fed increased the M2 money supply 25 percent from $15.3 trillion to $19.2 trillion in 2020, you couldn’t come up with a realistic inflation estimate when you published the FY22 budget in May 2021? And so on.
Okay. So now we know. The scientists and experts and economists at the OMB have no idea how to estimate inflation.
But then I thought: whatabout interest on the federal debt? A forecast of interest payments is pretty important for a wise and competent government. Interest payments show up in “Table 3.2 -- Outlays by Function and Subfunction” in the federal budget. So I added a chart to my Federal Interest Analysis page with OMB federal interest outlay forecasts from the FY21, FY22, FY23, and FY24 budgets. Here it is.
I know. It’s confusing, even for scientists and experts and economists. So I will tell you what the chart says. It says that the scientists and experts and economists at OMB had no idea -- after the money printer go brrr in 2020 and 2021 -- that outlays on interest on the federal debt were going to skyrocket in the near future. Not until the FY24 budget issued in March 2023. The numbers come from “Table 3.2 -- Outlays by Function and Subfunction” in the budget.
So let’s look at the third component in this delicate ballet of scientists and experts and economists: the Federal Debt. We all know the federal debt is much too high. But whatabout the budget forecast of the federal debt as projected by the scientists and experts and economists at the OMB? The federal debt is shown in “Table 7.1 -- Federal Debt at the End of Year” in the federal budget. So I added a chart to my Federal Debt Analysis page with OMB federal debt forecasts from the FY21, FY22, FY23, and FY24 budgets. Here it is.
So, when it comes to forecasting government spending and revenue and the difference, which ends up as debt, our scientists and experts and economists are pretty competent. With the FY22 budget released in 2021 after the start of World War COVID the “experts agreed” that federal debt would bump up about $6 trillion higher than forecast in the last Trump budget, the FY21 budget released in February 2020.
Test Question: What do the three charts tell us about the rulers of “Our Democracy™”?
Answer: Our rulers and the scientists and experts and economists at the Office of Management and Budget are pretty competent when it comes to forecasting government spending and revenue. But when it comes to forecasting inflation and interest rates they don’t have a clue.
But that means that our anointed leaders are no smarter than their benighted serfs and slaves. We serfs don’t have a clue what the economy is going to do.
That raises a question. Should our rulers have so much power to fight inflation and recession and climate change? Because they clearly don’t have a clue what they are doing, beyond the routine tasks of handing out government loot and plundering the people with taxes.
There is a land, far, far away, where the per-capita GDP just notched ahead of the U.S. It’s the land of Crazy Rich Asians that we know as Singapore. And do you know how much government spends in Singapore? About 10 percent of GDP a year, compared to 35 percent of GDP in the U.S. You could look it up.
“Experts agree” that Singapore could teach us a lesson.
Christopher Chantrill @chrischantrill runs the go-to site on US government finances, usgovernmentspending.com. Also get his American Manifesto and his Road to the Middle Class.
Images: USGovernmentSpending.com
Fearless Forecasting at the OMB
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30.01.2024
As you know, I am the sole proprietor of the most comprehensive and mandatory website on government spending in the United States. Even though Google Search downrated my site back in 2019. We are talking about usgovernmentspending.com.
The scientists and experts and economists at the Office of Management and Budget make some fearless forecasts about future federal spending -- and federal debt and GDP -- for the next five years when they issue the federal budget every year and hand it off to their pals at govinfo.gov.
A while back I wondered how well the scientists and experts and economists at the OMB were doing with their inflation forecasts. Yes, right there in the budget is “Table 10.1 -- Gross Domestic Product and Deflators Used in the Historical Tables” which, in every budget, includes a fearless inflation forecast going out five years. So I put a new chart on my US National Inflation Analysis page. It shows the inflation forecasts in the FY21, FY22, FY23, and FY24 budgets. Here it is.
Of course, you need to be a scientist or an expert or an economist to read the chart. So I will tell you what it says. It says that the folks at the OMB had no idea there would be inflation in our all-American future until the FY23........
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