Gov't liabilities increase by $11 trillion in 2004

Under the federal government's accounting rules, it ran a $412 billion dollar deficit in 2004. By the accounting rules that the real world uses, it was more like eleven trillion dollars:

Well, for the last few years, as per a legal requirement pushed through Congress by fiscal reformers, the Treasury has published within its financial report, for informational purposes, an annual Asset and Liability Statement for the government that does follow GAAP rules, using accrual accounting. And this statement shows the government's net liability increasing in 2004 by $11.087 trillion -- a good 27 times more than the official budget deficit. Looking at the "Overall Perspective" summary on page 11 (.pdf) we can see what this increase is composed of. The significant items: Medicare: $9.609 trillion Social Security: $0.812 trillion Federal debt held by public: $0.385 trillion Federal/veterans pensions: $0.182 trillion (Note: Medicare and Social Security net liabilities are computed over 75-years -- not using an unlimited horizon under which they are much larger.) To place these numbers in some scale, total US national income in 2004 was $10.3 trillion -- that was the total combined income of all individuals, businesses, everybody. So the 2004 increase in the accrued liabilities of the US government exceeded total national income.

Thanks, LBJ!