US government budget deficit 2019
OK so basically the United States government's budget deficit is expected to be around 1 trillion USD(see page 5). that's a 1000 times a 1000 USD that's given to 1000 people a 1000 times. a million times a million. 1012.
~3060 USD per inhabitant. ~22%(!) of the country's revenue. About as bad as Greece in 2008(~25%), worse than Greece in 2007(~17%).eurostat The estimate for the GDP for the US for 2019 is estimated at 21.344 trillion.IMF That means the budget deficit is ~4.7% of the GDP.
Take every major public oil company(not government owned), these companies are more enormous than imaginable already. Sum their book value equity, and it still wouldn't add up to 1 trillion USD. And this is what the US government needs it seems, for this year alone.
More comparisons: take all hits of all Neocities sites(nov 2019): ~4 billion, not even a percent. If every hit would cost something, you would need ~250 USD per hit in order to get to 1 trillion USD. Most viewed youtube video(Despacito): ~6.5 billion.
Now last year there was in the news that Italy proposed a budget with a deficit of ~2.4% of their GDP, but the European commission rejected it. It was fairly big news if I recall correctly.
The US deficit/GDP is twice that of Italy, and yet I have read little about it in the news. Considering that the US is the largest economy on the entire Earth, the US Dollar being a reserve currency, I expected something else. I understand that Italy is in the news because of the Greece debt crisis, and it has like 132% debt/GDP(no source sorry), and the US is not quite as staggering yet, but still. Perhaps a factor is also that I live in the Europe and the Eurozone where the Euro currency is used, and Italy is in Eurozone too, and the US isn't.
Now a high budget deficit might have a good reason. For example, after recovering from a major war. Or in an economic crisis, to not commit austerity which could snowball a recession to even worse levels. Or to make major investments. All of these reasons are temporary, as well.
But to me it seems that the US doesn't seem to have one of the reasons mentioned above. As far as I know, there are no huge investments. There is no recession. There is no war. So why is this?
Debt in the end must be paid back. I understand that a country is different from a typical household or a small company, but this still holds up. The interest on debt was 325 billion USD in 2018CBO: ~1000 USD per citizen(thankfully a large portion of US debt is held by inhabitants(including companies) of the US themselves). If there is more and more being lend, ceteris paribus, there will be more and more interest expenses, and the interest will be higher, something that the future will have to pay, whether it's a economically good or bad one.
It's also worth mentioning that to me it seems that lowering taxes and spend more is a lot easier than it is to spend less(austerity) and increase taxes. The latter you can hurt the economy with, leading to less income, leading to shooting yourself in the foot.
I would certainly call this deficit a little worrisome since this deficit is in my eyes huge and not easy to fix. On the short term this deficit isn't going to create many problems, but if you do this for years, it is going to be.
Perhaps one of the reasons the budget deficit is so high is because it's relatively cheaper to lend than in 2007. This is a world wide trend(a source, page 2 & 3): after the crisis in 2008 monetary policy has never recovered to levels before the crisis. For example, the current European central bank deposit facility rate(the interest rate banks and other institutions pay to store money at the ECB) is currently -0.5%. Yes, that's right, negative! In 2007 this was 3%. But this is a topic for another time.
Keep in mind I do not have a degree in economics or anything I do not have that much knowledge so yeah. Also I calculated some of these figures myself, so they may contain errors. I know this article is different from what my articles normally are, because you know, this is about the real world, but I felt like it, I don't know why.