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Economy in Brief

U.S. Government Budget Deficit Increases
by Tom Moeller  April 11, 2018

The U.S. Treasury Department reported that the federal government ran a $208.7 billion budget deficit during March 2018. A deficit of $187.0 billion had been expected in the Action Economics Forecast Survey. During the first six months of fiscal year 2018, the deficit totaled $599.7 billion, up 13.8% versus the first six months of FY'17.

Net revenues rose 1.6% y/y so far in FY'18, about the same as last year. Individual income taxes increased 5.9% y/y following a 2.7% rise during all of last year. The gain in social insurance receipts eased to 2.4% y/y from 4.2%, and excise taxes improved 10.6% y/y following last year's 11.8% shortfall. The rate of decline in corporate income taxes deepened to -21.6% y/y after they fell 0.8% during all of last fiscal year.

Government spending increased 4.8% y/y so far in FY'18 compared to 3.3% growth during all of FY'17. National defense spending rose 4.1% y/y after slight increases during the last two fiscal years. Health insurance spending grew 1.9% y/y, half what it did last year, while Medicare outlays increased an accelerated 2.0% y/y. Income security payments were little changed y/y after their 2.1% FY'17 decline. Social Security payments rose an accelerated 4.1% y/y. Interest payments gained 14.0% 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 Mar 2018 FY'17 FY'16 FY'15 FY'14 FY'13
Budget Balance (Billions) -- $-208.7 $-665.8 $-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 1.6% 1.5% 0.6% 7.6% 8.9% 13.3%
  Individual Income Taxes 47 5.9 2.7 0.3 10.5 5.9 16.3
  Corporate Income Taxes 9 -21.6 -0.8 -12.9 7.2 17.3 12.9
  Social Insurance Taxes 34 2.4 4.2 4.7 4.1 8.0 12.1
  Excise Taxes 3 10.6 -11.8 -3.3 5.3 11.1 6.3
Net Outlays  (Fiscal Year 2017 YTD, Y/Y % Change) 100 4.8 3.3 4.5 5.3 1.4 -2.4
  National Defense 15 4.1 0.8 0.7 -2.3 -4.7 -6.3
  Health 15 1.9 4.1 6.2 17.8 14.3 3.3
  Medicare 15 2.0 0.6 8.7 6.7 2.8 5.5
  Income Security 13 -0.2 -2.1 1.0 -0.9 -4.3 -1.1
  Social Security 24 4.1 3.1 3.2 4.4 4.5 5.2
  Veterans Benefits & Services 4 8.1 1.2 9.3 6.8 7.7 11.5
  Education, Training, Employment & Social Services 4 4.9 31.6 -10.2 34.7 25.9 -21.9
  Interest 7 14.0 9.2 7.8 -1.8 2.8 0.4
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