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Economy

Federal Debt Equals Roughly $287,859 Per Income-Tax-Paying Household

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National Debt Clock
National Debt Clock

The Biden administration wants to increase any taxes they can get their grubby hands-on, and CNS News explains why: because they need it. In an analysis, CNS writes about how as Congress “worked in recent days to increase the legal limit on the federal debt, the Treasury kept that debt artificially frozen at approximately $28.9 trillion, where it stood at the beginning of this week.”

With the limit lifted, the federal debt will increase, “then keep steadily climbing, constantly increasing the burden on future taxpayers.” Here’s the analysis:

In 2018, according to the last complete annual report on individual income tax returns published by the Internal Revenue Service, there were 100,424,240 households in the United States that filed what the IRS calls a “taxable return.” “The taxable and nontaxable classification of a return for this report is determined by the presence of ‘total income tax,'” explained the IRS.

“‘Total income tax,'” it said, “was the sum of income tax after credits.”

In other words, the 100,424,240 households that filed a “taxable return” in 2018 actually paid income taxes to the federal government.

If you divide the $28,908,004,857,445 in debt that the federal government owed before the debt limit was liftedby the 100,424,240 American households that paid net income taxes in 2018, it works out to approximately $287,859 per income-tax-paying household.

In order to understand the magnitude of what this means, CNS compares numbers to 1989:

The year that President Ronald Reagan left office, there were 89,178,355 income-tax-paying households in the United States, according to the IRS. At the end of January that year, the federal debt was $2,697,957,000,000.

That means the federal debt then equaled approximately $30,253 per income-tax-paying household.

Even when the January 1989 federal debt of $30,253 per income-tax-paying household is adjusted into November 2021 dollars (using the Bureau of Labor Statistics inflation calculator), it equals only approximately $69,437.

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1 Comment

1 Comment

  1. Marianne Garvens

    February 12, 2022 at 8:22 pm

    So how many households earn less than this amount? More than not. This is unsustainable and our leaders must know this!
    So what are they planning that we do not know?

    Where did Joe Biden and other ‘politicians’ go to school and what was the last grade from which he/they graduated?

    Haven’t they ever played Monopoly where there is a finite amount of money?

    You just can’t print more money when you go broke! You have to sell off your assets and pay your debts.

    And where would America be if it had to leverage all its assets?

    We would be owned by other countries – perhaps even our enemies!

    So don’t be tricked by our ‘leaders’ and a complicit media … educate yourself and then educate your friends and neighbors – and then start showing up and questioning/challenging your leaders and/or run for office yourself – at the very least start attending meetings and asking questions!

    It’s likely you will do better (having learned to operate reasonably within a budget!) – afterall, you can’t do any worse!

    Why don’t politicians understand this? Or are they just trying to dupe us?

    It’s high time President Biden, the Democrats, certain Republicans, the media, et al, stopped trying to ‘trick’ the People – we deserve better leaders and media.

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Economy

Atlanta Fed’s GDP Tracker Shows United States May Be In A Recession

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Joe Biden

The United States has likely entered a recession, according to the Federal Reserve’s key gauge for measuring economic activity.

The Atlanta Fed’s GDPNow measure, which tracks economic data in real time and continuously adjusts projections, says that the United States economy will shrink by 2.1% in the second quarter. A 2.1% contraction in the second quarter paired with the first quarter’s decline of 1.6% would meet the definition of a recession.

“GDPNow has a strong track record, and the closer we get to July 28th’s release [of the initial Q2 GDP estimate] the more accurate it becomes,” wrote Nicholas Colas, co-founder of DataTrek Research.

The tracker fell dramatically last week from an estimate of 0.3% after data “showing further weakness in consumer spending and inflation-adjusted domestic investment prompted the cut that put the April-through-June period into negative territory,” CNBC reported.

“One big change in the quarter has been rising interest rates,” CNBC added. “In an effort to curb surging inflation, the Fed has jacked up its benchmark borrowing rate by 1.5 percentage points since March, with more increases likely to come through the remainder of the year and perhaps into 2023.”

Last week, Federal Reserve Chairman Jerome Powell warned that the decision to fight inflation by increasing interest rates was “highly likely” to cause pain to Americans.

During the European Central Bank forum, host Francine Laqua asked Powell, “If you’re speaking out to the American people to try and help them understand how long it will take for, you know, monetary policy to go back to something that resembles normalcy … what would you tell them?”

“I would say that we fully understand and appreciate … the pain people are going through dealing with higher inflation, that we have the tools to address that and the resolve to use them, and that we are committed to and will succeed in getting inflation down to two percent,” Powell responded.

“The process is likely, highly likely to involve some pain, but the worst pain would be from failing to address this high inflation and allowing it to become persistent,” he added.

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Economy

Biden’s Fed Chairman: Solving Inflation ‘Highly Likely To Involve Some Pain’ For Americans

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On Wednesday, Federal Reserve Chairman Jerome Powell said that solving the inflation crisis is “highly likely” to cause pain to Americans but that it would be less painful than not addressing inflation.

During the European Central Bank forum, host Francine Laqua asked Powell, “If you’re speaking out to the American people to try and help them understand how long it will take for, you know, monetary policy to go back to something that resembles normalcy … what would you tell them?

“I would say that we fully understand and appreciate … the pain people are going through dealing with higher inflation, that we have the tools to address that and the resolve to use them, and that we are committed to and will succeed in getting inflation down to two percent,” he responded.

“The process is likely, highly likely to involve some pain, but the worst pain would be from failing to address this high inflation and allowing it to become persistent,” Powell added.

Powell’s comments come as inflation has reached the highest rate in more than 40 years with prices rising 8.6% from May 2021 to May 2022, according to a new report from the Bureau of Labor Statistics.

In order to bring down inflation, the Federal Reserve increased the interest rate by 0.75% earlier this month – the highest increase since 1994 – and warned of additional increases in the interest rate in the future.

“The three-quarter-point hike brings the federal funds rate to between 1.5% and 1.75%. The federal funds rate dictates what it costs for banks to borrow money from each other. And, generally, higher interest rates mean it’s more expensive for consumers to get a mortgage, obtain a loan to buy a vehicle and to carry a balance on a credit card,” NBC News reported. “The expected effect of these changes is that consumers will spend less and the heightened demand for goods — one of the drivers of inflation — will slow down.”

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