We have gone back to the budget numbers from 1963 forward and looked at three elements: annualized percent changes in Receipts and Outlays and the annualized difference of Receipts from Outlays. We present them here since they give a normalized view of the dimension of the problem we are facing.
First the annualized changes in receipts and outlays we show below. Note the red receipts line dipping below zero in 1971, 1983, 2002, 2009. These are the major years of recession. However the dip in 2009 is more than 3 times that of the worst one before, namely 1983. This is a powerful chart because it also shows the rise after the dip. This time we have had a structural recession and the return to normal may be dragged on. However the current Administration predicts a bounce never seen before under any circumstance. The swing exceeds any prior swing by many factors of a multiple. Namely it will NEVER occur.
At the same time look at the changes in outlays. The gap between outlay change and receipt change is the largest again in 2009.
This is the second chart with the difference in percent changes. Note that the 1976 negative swing was 17% whereas the 2009 swing was down 35%. That is twice the worst case. The positive swing upward will not have any rational justification for happening. The current Administration is going into uncharted waters and they are doing so with no rational economic model to work with.
The fear amongst any group of rational people who have the slightest bit of real world experience is that the current team in the current Administration focusing on the budget and the economy are doing so apparently not only blindfolded but almost with a malice. Nothing else seems to explain why the assumptions are so baseless and the reality is so terrifying.
First the annualized changes in receipts and outlays we show below. Note the red receipts line dipping below zero in 1971, 1983, 2002, 2009. These are the major years of recession. However the dip in 2009 is more than 3 times that of the worst one before, namely 1983. This is a powerful chart because it also shows the rise after the dip. This time we have had a structural recession and the return to normal may be dragged on. However the current Administration predicts a bounce never seen before under any circumstance. The swing exceeds any prior swing by many factors of a multiple. Namely it will NEVER occur.
At the same time look at the changes in outlays. The gap between outlay change and receipt change is the largest again in 2009.
This is the second chart with the difference in percent changes. Note that the 1976 negative swing was 17% whereas the 2009 swing was down 35%. That is twice the worst case. The positive swing upward will not have any rational justification for happening. The current Administration is going into uncharted waters and they are doing so with no rational economic model to work with.
The fear amongst any group of rational people who have the slightest bit of real world experience is that the current team in the current Administration focusing on the budget and the economy are doing so apparently not only blindfolded but almost with a malice. Nothing else seems to explain why the assumptions are so baseless and the reality is so terrifying.
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