The Real Federal Budget Deficit Is More Like $5 Trillion
Even as President Obama and his apologists try to claim that he has a fiscally conservative record, America is set to run an official budget deficit well over $1 trillion for the fourth year in a row. But the real budget deficit is much greater, because Congress exempts from that deficit shortfalls in pension programs like Social Security.
They just pretend like those shortfalls don’t exist.
The big difference between the official deficit and standard accounting: Congress exempts itself from including the cost of promised retirement benefits. Yet companies, states and local governments must include retirement commitments in financial statements, as required by federal law and private boards that set accounting rules.
The deficit was $5 trillion last year under those rules. The official number was $1.3 trillion. Liabilities for Social Security, Medicare and other retirement programs rose by $3.7 trillion in 2011, according to government actuaries, but the amount was not registered on the government’s books.
We can have a debate about Social Security, and whether or not it can be fixed to become a solvent program, but at the very least shouldn’t the federal government be presenting the public with an accurate accounting of the fiscal burden that program represents?