Record Increase in Maine’s Personal Current Transfer Receipts
In my previous blog I hinted that Maine’s Personal Current Transfer Receipts (PCTR) were behind the large drop in the private sector share of personal income. Between 2008 and 2009, PCTR increased by 12.8 percent to $11 billion from $9.8 billion. In nominal dollars, the $1.2 billion increase is the largest increase, since, well, 2008s $1 billion increase. In two years, Maine’s PCTR grew by $2.2 billion!
As a percent of personal income, PCTR jumped to 22.7 percent in 2009 from 18.9 percent in 2007. That means that more than 1 in 5 dollars sloshing around in Maine’s economy came from these government programs–mostly Medicare, Medicaid and Social Security.
Given that all of these programs are in various degrees of insolvency at the federal level, this does not bode well for the future of Maine’s economy. In fact, this year was the first year that Social Security revenue was less than expenditures meaning the Social Security Administration had to dip into their IOUs from Uncle Sam.
Unfortunately, BEA will not release the details of PCTR for 2009 until later this year. However, we can take a look a the data we do have up to 2008 to get a glimpse of what 2009 will like . . . click “continue reading” to view charts. Enjoy!