Personal Economics 101

Trillion Dollar Deficits as Far as The Eye Can See From Investopedia The Senate and the U.S. House of Representatives passed a funding bill on Saturday evening, avoiding a shutdown.  The bill will fund government operations through November 17, leaving the door open for future negotiations. It includes natural disaster relief, but there is no additional funding for Ukraine to continue fighting Russia. There is also no additional funding for border security, but it does have funds to keep the Federal Aviation Administration operational. The House bill received strong Democratic support after Republican Speaker Kevin McCarthy reversed his stance on seeking bipartisan support. Lawmakers  worked to avoid the federal government's fourth partial shutdown in a decade, which was set to come into force at 12:01 a.m. Sunday (Oct 1). The Democratic-majority Senate passed the bill. The House voted 335-91 to continue funding the government for 45 days and received more support from Democr...

History Channel: How Many Times Has the Federal Government Shut Down? In the United States, a government shutdown happens when there is a gap in federal funding and the government furloughs federal workers without pay. Although there are exceptions for certain “essential” employees (including the president and members of Congress, all of whom continue to receive pay) a shutdown means that a large portion of the federal government stops functioning . Kelly Evans: The $2 trillion deficit: how did we get here? It’s a little unnerving that we’re seeing record budget deficits, soaring government debt, and steadily rising interest rates--all at the same time. How much of this can be undone? And how did we get here? The short answer is, government spending remains notably higher than it was pre-Covid, while revenues are more or less the same. And the fact that both deficits and debt are higher than in the past while our borrowing costs have soared means that paying interest is also taking up ...

The baby boomers capitalized on an unprecedented 40-year rally in stock and housing prices. Now, those babies are bequeathing on an equally epic level. According to financial market intelligence firm Cerulli and Associates , baby boomers and the Silent Generation (preceding boomers) will pass down $84.4 trillion in assets through 2045, with $72.6 trillion going directly to heirs. The Bank Administration Institute says it will “end up as the greatest transfer of wealth in history.” So, how, exactly, do tens of millions of people pass on tens of trillions of dollars? Let’s examine the situation. Boomers are handing down the lion’s share of the wealth — $53 trillion or 63% of all transfers. The Silent Generation will hand down $15.8 trillion, mostly over the coming decade. Ultra-high-net-worth households in the top 1.5% will account for 42% of the Great Wealth Transfer — about $35.8 trillion. That last part shouldn’t be surprising. The rich have always passed estates down to their heirs,...

This is your bedrock for all your finances. Without an emergency fund, any other goals you may have, such as investing or saving for a vacation or college, will get derailed. It's difficult to recover.  But first of all, have a budget and follow it. I'm retired now, but still use a budget. It's basic to sound financial planning and peace-of-mind. Recent surveys indicate that 61 percent of American families cannot come up with $400 to meet an emergency. Don't be one of these people. 

Massive spending increases for various bureaucracies is the most offensive part of Biden’s new budget. These huge budgetary increases (well above the rate of inflation, unlike what’s happening to incomes for American families) were not the most economically harmful feature of Biden’s plan. That dubious honor belongs to either his massive expansion of the welfare state or his big tax increases. The Wall Street Journal editorialized a couple of days ago about what the president is proposing. A President’s budget is a declaration of priorities, so it’s worth underscoring that President Biden’s new budget for fiscal 2023 proposes $2.5 trillion in tax increases over 10 years. His priority is taking money from the private economy and giving it to politicians to spend. …Raising the top income-tax rate to 39.6% from 37% would raise $187 billion. Raising capital-gains taxes, including taxing gains like ordinary income for taxpayers earning more than $1 million would snatch $174 billion. Raisin...

1. Biden Budget Would Raise Income Tax Rates to Highest in the Developed World Sensible message, not so sound policy: President Biden’s budget came out this week with a sensible message about the need for stronger economic growth and sound fiscal policy. Unfortunately, the actual policies laid out in the budget would reduce economic growth and create unsound fiscal policy, with no real evidence provided to support claims to the contrary. Not good to be number one: The budget proposes several new tax increases on high-income individuals and businesses, which in combination with the Build Back Better Act would give the U.S. the highest top tax rates on individual and corporate income in the developed world. Several questions also remain about the OECD global tax deal’s prospects, implementation, and effectiveness, which could affect the administration's tax plans for U.S. multinational companies doing business abroad. On the spending side: The budget proposes increased spending for ...

President Joe Biden’s budget proposal , which the president released today, calls for the federal government to collect a record $4,638,000,000,000 ($4.6 Trillion) in taxes in fiscal 2023. At the same time that the federal government is collecting those record taxes, according to Biden’s proposal , it would also spend $5,792,000,000,000 ($5.8 Trillion) —resulting in a fiscal 2023 deficit of $1,154,000,000,000 ($1.2 Trillion). According to Table S-4 in Biden’s budget proposal, the federal government will run a cumulative deficit of $14,421,000,000,000 ($14.4 Trillion) in the ten years from fiscal 2023 to fiscal 2032. The $1,154,000,000,000 ($1.2 Trillion) deficit the Biden budget proposes running in fiscal 2023 is the smallest federal deficit it anticipates in any of the next ten years. In fiscal 2021, according to Table S-4 in Biden’s budget proposal, the federal deficit was $2,775,000,000,000 $2.8 Trillion). In fiscal 2022, the Biden budget proposal estimates it will drop to $1,415,00...

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Buried in the Budget Reconciliation Is the End of Right-to-Work, Independent Contractors; Climate Change Among the various major provisions of the PRO Act is effective nationalization of California's AB5 law that passed in 2019. This law makes hiring independent contractors much more difficult and specifies that contractors must be reclassified by businesses that hire them as employees, unless they meet specific and rigorous standards allowing them to stay independent. Read full article... Biden on Energy Crisis: Begging Others to Save Him From Himself It is on the costs of energy where Biden’s failures are most starkly visible. On his very first day in office, Biden scrapped the Keystone XL pipeline, killing 11,000 jobs in the process and making good on his campaign promise to be hostile to the fossil fuel industry. Continuing his assault on natural resource development, Biden suspended oil and natural gas leases in Alaska. Former President Donald Trump had propelled America to en...

One of the current issues facing the U.S. economy is more demand than supply can keep up with. Part of the issue has been government programs that have incentivized workers to stay home, and the result is a labor shortage and a record number of job openings, while the workforce participation rate drops to the lowest in decades.  In the meantime, Democrats on Capitol Hill have been busily working on a new spending package.  The cradle-to-grave subsidies in the 2,448-page, $3.5 trillion spending bill that Democrats in Congress are crafting will create a welfare trap for millions more Americans, send inflation soaring, and drive our nation much deeper into debt. Economic policy professor Chuck Blahous of the Mercatus Center at George Mason University analyzed the health benefit proposals in the spending bill. He wrote that expanding Medicare, Medicaid, and “so-called Obamacare” will “represent a major escalation of the fiscal irresponsibility lawmakers have practiced for the past...

 I got this question on Quora today. It's a common question. The answer I provided is below.  I got into debt young as I didn’t realize how important it was to have a good credit score. How can I get myself out of this mess? I’m worried it’s going to affect future relationships. You really must to want to be debt-free. There is no other way. It’s a process, of both knowledge of personal finance, and modifying your financial behavior. But it is something you can achieve, if you create a plan and follow the steps of sound financial planning. I’m going to tell you up front that it will take quit a bit of work and effort on your part, depending on how much debt you have, and what you are willing to do. We had a saying in the military about what needed to be done do accomplish our mission: “Whatever is necessary.” This will be the same kind of thing. So you have to develop the same mindset. Be hungry. Personal finance is 20 percent knowledge, and 80 percent behavior. When I starte...

In a study just published by the Club for Growth Foundation, co-authored with Robert O'Quinn (former Chief Economist at the Department of Labor), they estimated the likely economic impact of President Biden's so-called Build Back Better plan to expand the welfare state. Here are the main findings: A loss of $3 trillion of economic output over the next 10 years A loss of $1.6 trillion of worker compensation over the next 10 years A loss of more than $10,000, on average, in compensation for workers over the next 10 years A lifetime drop in living standards of almost four percent for young workers What's especially noteworthy about the study is that they based their analysis on research published earlier this year by the Congressional Budget Office . In other words, a very establishment source. Biden's fiscal agenda would made the United States more like Europe and the economic data unambiguously demonstrate that Europeans suffer from significantly lower living standards...

By Allison Schrager Bloomberg Opinion Printed in Stars and Stripes The infrastructure bill moving through the Senate takes more than 2,700 pages to lay out $1 trillion in spending. Many aspects of the plan will be popular. Americans love infrastructure; who doesn’t want nicer airports, roads, bridges, clean drinking water and access to cheap broadband? In theory at least, we not only enjoy better infrastructure, it’s an investment in our future — making the country safer, more resilient and boosting growth. But many of the potential economic benefits will be undermined by the nearly 60 pages of the bill dedicated to “Build America, Buy America.” Buy America requirements have been around since the Great Depression and are often a feature in U.S. infrastructure plans. They require that government-funded projects use domestically produced materials and are completed by American firms with American workers. This latest incarnation is similar to others before it. There are, of course, many ...

This is a question I get asked a lot on Quora. "What are the best ways to get out of debt?" Here's my most recent answer: You really must to want to be debt-free. There is no other way. It’s a process, of both knowledge of personal finance, and modifying your financial behavior. But it is something you can achieve, if you create a plan and follow the steps of sound financial planning. I’m going to tell you up front that it will take quit a bit of work and effort on your part, depending on how much debt you have, and what you are willing to do. We had a saying in the military about what needed to be done do accomplish our mission: “Whatever is necessary.” This will be the same kind of thing. So you have to develop the same mindset. Be hungry. Personal finance is 20 percent knowledge, and 80 percent behavior. When I started I had more than $50,000 in credit card debt, had two mortgages (one on a rental house that was actually costing me more than I made in rents), and a cou...

 

The Big Double-Cross President Joe Biden Supposedly, a bi-partisan group of Democrat and Republican Senators reached an agreement with President Biden on a $1.2 trillion "infrastructure" package. But an hour later, Biden changed the conditions of the agreement, saying he would not sign the bill, if passed, unless he also received a bill that would include everything else he wanted, some $3 trillion in other "infrastructure" programs.  Republican senators are now threatening to sink a the compromise after President Joe Biden said that its adoption was conditioned on the passage of a complementary bill containing top Democratic priorities. Multiple senators who took part in bipartisan negotiations during the bill’s creation have already said that they may now withhold their support, jeopardizing its passage given the 60 votes necessary for it to overcome a potential filibuster. “No deal by extortion!” South Carolina Republican Sen. Lindsey Graham said Friday. “It was ...

See also: The State of Health Care at the end of 2020  

I too once lived paycheck to paycheck. It's a hard way to live, at least financially. But I got out. Here are some suggestions on how you can too.  Living paycheck to paycheck isn't uncommon these days. Recent studies suggest many Americans are doing just that, which in turn makes it next to impossible to save and invest. Overspending can be part of the problem, but even more often people get squeezed through no fault of their own—low wages, unpredictable income and high costs for essentials like childcare, healthcare, housing and college. On the other hand, even people with high incomes can find themselves caught in a seemingly never-ending cycle. When you’re in this situation and just barely making ends meet each month, it can seem as though you’re on an endless financial treadmill. So how do you jump off? It's a combination of attitude and action. First realize that you can do it—then take these steps to make it happen. Budgets are key Start by tracking your spending wit...