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Economy in Brief

U.S. Government Budget Deficit Deepens
by Tom Moeller  June 12, 2019

The U.S. Treasury Department reported that the federal government ran a $207.8 billion budget deficit during May compared to a $146.8 billion deficit one year earlier. A $198.2 billion deficit had been expected in the Action Economics Forecast Survey. During the first eight months of FY'19, the budget deficit deepened to $738.6 billion compared to a deficit of $532.2 billion during the first eight months of FY'18.

Net revenues rose 2.3% y/y so far this fiscal year compared to a 2.6% y/y gain during in first eight months of FY'18. Individual income receipts rose 1.5% y/y so far in FY'19, compared to a 9.0% y/y rise in the first eight months of FY'18. Corporate tax receipts fell by 8.6% y/y so far this year after a 25.4% eight-month y/y drop last year. Social insurance receipts rose 4.5% y/y following a 2.1% gain early in FY'18, and excise taxes rose by 15.1% y/y after last year's 11.5% increase.

Government spending increased 9.3% y/y so far in FY'19 after a 5.9% y/y rise last year over the same eight-month period. National defense spending strengthened 12.4% y/y following no change y/y in the first eight months last year. Spending on health programs increased 5.3% y/y, half the gain last year while Medicare outlays rose by roughly one-quarter y/y following a 2.5% eight-month rise last year. Growth in income security payments have increased 7.6% y/y so far in FY'19 after a slight decline in the first eight months of FY'18. Social Security payments gained 5.7% y/y after rising 4.3% in the first eight months of FY'18. Interest payments rose by 15.6% y/y, about the same as 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 May FY'18 FY'17 FY'16 FY'15
Budget Balance (Billions) -- $-207.8 $-779.0 $-665.8 $-585.6 $-439.1
Fiscal 'YTD -- $-738.6 -- -- -- --
  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 2.3% 0.4% 1.5% 0.6% 7.6%
  Individual Income Taxes 51 1.5 6.1 2.7 0.3 10.5
  Corporate Income Taxes -- -8.6 -31.1 -0.8 -12.9 7.2
  Social Insurance Taxes 35 4.5 0.8 4.2 4.7 4.1
  Excise Taxes 3 15.1 13.3 -11.8 -3.3 5.3
Net Outlays  (Fiscal Year 2017 YTD, Y/Y % Change) 100 9.3 3.2 3.3 4.5 5.3
  National Defense 16 12.4 5.3 6.1 0.7 -2.3
  Health 13 5.3 3.3 -1.9 6.2 17.8
  Medicare 14 22.7 -1.4 0.6 8.7 6.7
  Income Security 12 7.6 -1.6 -2.1 1.0 -0.9
  Social Security 24 5.7 4.5 3.1 3.2 4.4
  Veterans Benefits & Services 4 22.8 1.3 1.2 9.3 6.8
  Education, Training, Employment & Social Services 2 5.2 -34.0 31.6 -10.2 34.7
  Interest 8 15.6 23.6 9.1 7.8 -1.8
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