Happy New Year!! The US Daily Deficit for 1/2/2013 was $3.1B. I’m not going to put up any charts and it’s too early in the month to really predict anything, so let’s take a look back at January 2012. A year ago, the deficit was $53B on 256B of revenue and $309B in outlays. It seems likely that we will see improvement over last January. We are coming off a pretty strong revenue month in 12/2012 which could carry over. There are some smaller timing issues related to outlays that should help a little bit, and finally, with the expiration of the payroll tax cut and the increasing of rates for the “wealthy”, we should start seeing revenues running $15-20B higher…on top of what we were seeing. On the other hand, social security recipients get a 1.7% raise this month…good for around another $1B per month…plus the 10k people who retire every day. I shouldn’t even throw a number out but what the heck. I’ll throw my dart at a $10B deficit for this month. Last month, my initial prediction was $30B deficit and we ended up with a $21B surplus….let’s see how this month ends up.
Swing and a Miss!! The US Daily Deficit for 12/31/2012 was $1.4B, substantially lower than my projection if $15-25B, leaving December’s surplus solidly intact at $20.6B vs December 2011’s $59.3B deficit. I’ll have more analysis later, but Revenue was up $45B and Outlays were down $35B resulting in an $80B improvement. No too shabby, if it it sticks. I’m hoping to get a 2012 total year piece posted in the next few days, and after that maybe a more in depth review of December and a look at January. So many things to do, so little time.
With about 6 hours to go, I am reading a report saying a deal is close on avoiding the fiscal cliff, with just a few sticking points to be ironed out. I don’t know the details yet, but I doubt that it matters too much. I don’t think anyone ever expected rates to increase on most of us, regardless of whether the deal was done a few weeks back or even six months from now. Here’s what you need to know…while Republicans and Democrats have been engaged in an epic battle over whether to raise taxes on the “wealthy” by $25B per year or $50B per year….your taxes were raised $125B for 2013 due to the expiration of the payroll tax cut.
Now honestly, this probably needed to be done…especially if you are in the camp that believes the social security trust fund isn’t make believe. But the truth is, FICA is an income tax no different than any other, and while they distracted the country over the last month arguing over whether “wealthy” was defined as $250k per year or $1M per year….both parties quietly raised everybody elses taxes 2%. I’m waiting for the outrage that won’t come because let’s be honest…as a nation, math really isn’t our thing.
The US Daily Surplus for 12/28/2012 was $4.0B, bringing the surplus to $22B with 1 business days remaining in December. Today, 12/31/2012 will likely record a large deficit in the 15-25B range, but we’ll have to wait till Wednesday afternoon to find out. Last year, the deficit for 12/31 was $19.7B.
Happy New Years to All…be safe and enjoy the day off. I’ll be working tomorrow…note to self…in my next life, choose a career other than accounting!!
