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Feds Wrap Up Fiscal Year 2020 With $6 Trillion Record Spending

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EDITOR NOTE: As the federal government wraps up its fiscal year 2020, analysts estimate that we’re at a league far above that which we feared in 2009 amid the Great Recession. Federal spending blew past $6 trillion; our federal deficit doubled that of the last financial crisis. And with QE ongoing, interest rates held near zero, and a pandemic continually deferring its terminal point, the only solution we can expect from the federal government may be more spending. More debt. The value of your dollar will be decimated as inflation accelerates. Remember, the government can print money. You can’t. And the more it prints, the more it takes from you (diluting your purchasing power). That is, unless you’re invested in the only assets capable of withstanding such monetary and fiscal abuse--gold and silver. Bear in mind; we are nearing the October 12th-18th meeting of the IMF to recalibrate the SDR, potentially dropping the importance of the US Dollar on the global stage! Arm yourself with non-CUSIP gold and silver now, before the value of your dollar is chopped in half, as Stephen Roach estimates it will by the end of 2021. 

The federal government’s fiscal 2020 year ends today at midnight, and federal spending has eclipsed $6 trillion for the first time ever—and that’s without data from September, the final month federal officials can obligate annual Congressionally-appropriated funds before they expire.

According to data from the Treasury Department, total government spending in fiscal 2020 reached $6.1 trillion by Aug. 31. The 2020 budget deficit now stands at $3 trillion through August—also a first, meaning the government has spent $3 trillion more than it has taken in this year—following 11 consecutive months of deficit spending compounded by the coronavirus pandemic. The current budget deficit is nearly twice as large as the previous highest deficit run in fiscal 2009 amid a national recession.

Fiscal 2020 spending has been dominated by health care, entitlements and the military, with the Health and Human Services Department ($1.3 trillion), Social Security Administration ($1.2 trillion) and Defense Department ($690 billion) the top-three spending agencies. While the Treasury has not tabulated the government’s COVID-19 spending, the nonprofit, nonpartisan Committee for a Responsible Federal Budget estimates the government has committed or disbursed $2.2 trillion in economic relief.

The government’s traditional September spending surge will push these totals higher, as civilian and defense agencies obligate the rest of the fiscal 2020 money appropriated by Congress through contracts for various goods and services. As of early August, federal agencies had obligated $438 billion on contracts and were on pace to exceed the single-year contract spending record of $598 billion set in fiscal 2019. An analysis from Bloomberg Government suggests total contract spending in fiscal 2020 could tally $630 billion between civilian and defense, even without factoring in COVID-19-related spending. There’s still money to spend on contracts, according to analysts from the Pulse of GovCon, who told Nextgov that as of June, 78% of appropriated fiscal 2020 dollars were “still on the table.”

David Berteau, president and CEO of the Professional Services Council, told Nextgov contract spending estimates are difficult to forecast because spending data can lag up to three months for the Defense Department. It has been made more difficult in fiscal 2020 due to money coming from the $2 trillion CARES Act. However, Berteau said it is clear the government is choosing to spend its available contracting dollars on products over services.

“Ships and planes are driving an increase in spending at [the Defense Department], but there’s a lot of uncertainty,” Berteau said. 

Originally posted on Nextgov

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