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Economy in Brief

U.S. Government Budget Deficit Narrows
by Tom Moeller  January 11, 2018

The U.S. Treasury Department reported that the federal government ran a $23.2 billion budget deficit during December 2017 compared to a $27.3 billion deficit in December 2016. A deficit of $50.2 billion had been expected in the Action Economics Forecast Survey.

Net revenues rose 3.9% y/y in the first three months of FY'18. Individual income taxes increased 10.8% y/y following a 2.7% rise during all of last year. The gain in social insurance receipts eased to 2.7% y/y and excise taxes improved 0.4% y/y following last year's 11.8% shortfall. The rate of decline in corporate income taxes picked up to -18.1% y/y after falling 0.8% during all of last fiscal year.

Government spending increased 4.6% y/y so far in FY'18 compared to 3.3% growth during all of FY'17. National defense spending rose 5.9% y/y after slight increases during the last two fiscal years. Health insurance spending eased 0.5% y/y following two years of single-digit growth, while Medicare outlays were little changed y/y. Income security payments were fairly stable y/y after their 2.1% FY'17 decline. Social Security payments increased a steady 3.4% y/y. Interest payments rose 15.6% y/y after 9.2% growth last year.

Haver's data on Federal Government outlays and receipts are contained in USECON. Considerable detail is given in the separate GOVFIN database. The Action Economics Forecast Survey numbers are in the AS1REPNA database.

United States Government Finance Dec 2017 FY'17 FY'16 FY'15 FY'14 FY'13
Budget Balance (Billions) -- $-23.2 $-665.7 $-585.6 $-439.1 $-483.4 $-680.2
  As a percent of GDP -- -- 3.5% 3.2% 2.5% 2.8% 4.1%
% of Total
Net Revenues (Fiscal Year YTD 2018, Y/Y % Change) 100 3.9% 1.5% 0.6% 7.6% 8.9% 13.3%
  Individual Income Taxes 47 10.8 2.7 0.3 10.5 5.9 16.3
  Corporate Income Taxes 9 -18.1 -0.8 -12.9 7.2 17.3 12.9
  Social Insurance Taxes 34 2.7 4.2 4.7 4.1 8.0 12.1
  Excise Taxes 3 0.4 -11.8 -3.3 5.3 11.1 6.3
Net Outlays  (Fiscal Year 2017 YTD, Y/Y % Change) 100 4.6 3.3 4.5 5.3 1.4 -2.4
  National Defense 15 5.9 0.8 0.7 -2.3 -4.7 -6.3
  Health 15 -0.5 4.1 6.2 17.8 14.3 3.3
  Medicare 15 0.1 0.6 8.7 6.7 2.8 5.5
  Income Security 13 -0.1 -2.1 1.0 -0.9 -4.3 -1.1
  Social Security 24 3.4 3.1 3.2 4.4 4.5 5.2
  Veterans Benefits & Services 4 6.6 1.2 9.3 6.8 7.7 11.5
  Education, Training, Employment & Social Services 4 11.1 31.6 -10.2 34.7 25.9 -21.9
  Interest 7 15.6 9.2 7.8 -1.8 2.8 0.4
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