Great News! Government liabilities rose $2 trillion in FY 2010

The U.S. government fell deeper into the red in fiscal 2010 with net liabilities swelling more than $2 trillion as commitments on government debt and federal benefits rose, a U.S. Treasury report showed on Tuesday.

The Financial Report of the United States, which applies corporate-style accrual accounting methods to Washington, showed the government's liabilities exceeded assets by $13.473 trillion. That compared with a $11.456 trillion gap a year earlier.

Unlike the normal measurement of government intake of receipts against cash outlays, accrual accounting measures costs such as interest on the debt and federal benefits payable when they are incurred, not when funds are actually disbursed.

The report was instituted under former Treasury Secretary Paul O'Neill, the first Treasury secretary in the George W. Bush administration, to illustrate the mounting liabilities of government entitlement programs like Medicare, Medicaid and Social Security.

The government's net operating cost, or deficit, in the report grew to $2.080 trillion for the year ended September 30 from $1.253 trillion the prior year as spending and liabilities increased for social programs. Actual and anticipated revenues were roughly unchanged.

That's about a $750 billion increase in one year. That number represents 20% of our $3.7 billion federal budget.

The word "unsustainable" comes to mind, but if you mention entitlement reform - or pension reform, or budget reform - the left raises holy hell and swears everything is fine with social security and medicare and the numbers floating around (like the one above) are scare tactics by evil conservatives who want to get rid of social security and gut medicare.

We are addicted to spending more than we can possibly take in. And the cure is going to be so bad even fiscal hawks will balk at the measures that will be necessary to right the ship and save us from collapse.