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Economy in Brief

U.S. Government Budget Deficit Surges Unexpectedly
by Tom Moeller  December 13, 2018

The U.S. Treasury Department reported that the federal government ran a $204.9 billion budget deficit during November. The deficit compared to a shortfall of $138.5 billion during November 2017. A $165 billion deficit had been expected in the Action Economics Forecast Survey. So far this fiscal year, the federal government ran a $305.4 billion budget deficit compared to a $201.8 billion deficit in the first two months of last fiscal year.

Net revenues increased 3.4% y/y so far this fiscal year. Individual income taxes declined 1.9% y/y, compared to a 6.1% rise during all of FY'17. Social insurance receipts rose 3.0% y/y following last year's 0.8% gain, and excise taxes rose by roughly one-half y/y after last year's 13.3% increase. Corporate income taxes declined 23.0% due to the tax cut.

Government spending increased 18.4% y/y so far this fiscal year. National defense spending rose 16.8% y/y after a 5.3% gain last year. Health insurance spending increased 4.0% y/y while Medicare outlays rose by nearly two-thirds y/y. Growth in income security payments surged 29.7% y/y. Social Security payments increased a steady 5.1% y/y. Interest payments rose 9.0% y/y with the larger budget deficit.

Receipt & outlay figures often are quite variable y/y near the start of a new fiscal 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 Nov FY'18 FY'17 FY'16 FY'15
Budget Balance (Billions) -- $-204.9 $-779.0 $-665.8 $-585.6 $-439.1
  As a percent of GDP -- -- 3.9% 3.5% 3.2% 2.5%
% of Total
Net Revenues (Fiscal Year YTD 2018, Y/Y Change) 100 3.4% 0.4% 1.5% 0.6% 7.6%
  Individual Income Taxes 51 -1.9 6.1 2.7 0.3 10.5
  Corporate Income Taxes -- -23.0 -31.1 -0.8 -12.9 7.2
  Social Insurance Taxes 35 3.0 0.8 4.2 4.7 4.1
  Excise Taxes 3 51.3 13.3 -11.8 -3.3 5.3
Net Outlays  (Fiscal Year 2017 YTD, Y/Y % Change) 100 18.4 3.2 3.3 4.5 5.3
  National Defense 16 16.8 5.3 6.1 0.7 -2.3
  Health 13 4.0 3.3 -1.9 6.2 17.8
  Medicare 14 60.1 -1.4 0.6 8.7 6.7
  Income Security 12 29.7 -1.6 -2.1 1.0 -0.9
  Social Security 24 5.1 4.5 3.1 3.2 4.4
  Veterans Benefits & Services 4 84.5 1.3 1.2 9.3 6.8
  Education, Training, Employment & Social Services 2 13.7 -34.0 31.6 -10.2 34.7
  Interest 8 9.0 23.6 9.1 7.8 -1.8
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