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Economy in Brief

U.S. Government Budget Deficit Shrinks During October
by Tom Moeller  November 11, 2021

• Receipts from individuals & corporations remain strong.

• Income security outlays decline sharply.

The U.S. Treasury Department reported a federal budget deficit of $165.1 billion during October compared to a $284.1 billion deficit in October 2020. Expectations had been for a $137 billion deficit in the Action Economics Forecast Survey. During all of Fiscal Year 2021, the budget deficit lessened to $2.772 trillion from $3.132 trillion in FY 2020. Revenues grew 18.3% last year as outlays increased 4.1%.

Overall revenues have increased 19.4% y/y during October. Individual income tax receipts increased 32.3% y/y as employment & earnings continued to grow. Corporate tax payments strengthened 71.6% y/y with improved business profitability. Social insurance taxes rose 3.9% y/y in October and customs duties improved by roughly one-quarter y/y.

Federal government outlays in October declined 13.9% y/y. Defense spending fell 13.8% y/y after last year's 4.0% increase. Medicare payments fell 44.0% y/y. Income security payments declined 3.5% y/y with lower unemployment and the end of the Pandemic Unemployment Assistance program. Spending on health programs in October grew 10.3% y/y while Social Security payments increased 3.6% y/y. Interest payments fell 7.8% y/y in October.

Haver's data on Federal Government outlays are contained in USECON; The expectations figure is the AS1REPNA database.

United States Government Finance Oct FY'21 FY'20 FY'19 FY'18
Budget Balance (Billion $) -- -$165.06 -$2,772.18 -$3,131.92 -$984.39 -$779.00
Fiscal YTD -- -- -- -- -- --
% of Total (FY 2021)
Net Revenues (Fiscal Year YTD 2021, Y/Y % Change) 100 19.4 18.3 -1.2 4.0 0.4
  Individual Income Taxes 51 32.3 27.1 -6.4 2.0 6.1
  Corporate Income Taxes 9 71.6 75.5 -8.0 12.5 -31.1
  Social Insurance Taxes 32 3.9 0.3 5.4 6.2 0.8
  Customs Duties 2 26.2 16.7 -3.2 71.4 19.4
Net Outlays  (Fiscal Year YTD 2021, Y/Y % Change) 100 -13.9 4.1 47.3 8.2 3.2
  National Defense 11 -13.8 4.0 5.6 8.8 0.1
  Health 12 10.3 6.4 28.1 6.1 9.8
  Medicare 10 -44.0 -10.3 19.2 10.6 -1.4
  Income Security 24 -3.5 30.6 145.0 3.9 -1.6
  Social Security 17 3.6 3.5 4.9 5.7 4.5
  Veterans Benefits & Services 3 -26.4 7.1 9.3 11.9 1.3
  Education, Training, Employment & Social Services 4 66.4 25.3 75.5 43.7 -34.0
  Interest 5 -7.8 2.2 -8.2 15.7 23.6
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