Global| Oct 16 2020U.S. Government Budget Deficit Surged In FY 2020
by:Tom Moeller
|in:Economy in Brief
Summary
• Budget gap totals $3.132 trillion. • The deficit accounted for roughly 16% of GDP, the most since 1945. • Receipts declined while outlays surged. The U.S. Treasury Department reported that the budget deficit increased to $3.132 [...]
• Budget gap totals $3.132 trillion.
• The deficit accounted for roughly 16% of GDP, the most since 1945.
• Receipts declined while outlays surged.
The U.S. Treasury Department reported that the budget deficit increased to $3.132 trillion during FY 2020 as the unemployment rate surged and health care outlays related to the coronavirus jumped. During September alone, the deficit of $124.611 billion compared to an $82.768 surplus twelve months earlier. The Action Economics Survey anticipated a $124.0 billion deficit for last month.
Federal government outlays jumped 47.3% in FY 2020 to $6.55 trillion. The increase was driven by a 145.0% surge in income security payments to $1.26 trillion, stemming from coronavirus relief payments and a spike in the unemployment rate to an average 7.3% in FY 2020 from 3.7% in FY 2019. Health care spending surged to $748.0 billion (28.0% y/y) in FY 2020 while Medicare spending rose to $776,2 billion (19.2% y/y). Social security payments grew a lessened 4.9% y/y to $1.10 trillion while growth in defense outlays also slowed to 5.6% y/y to $726 billion. Interest payments declined 8.2% versus FY 2019 to $345 billion.
Overall revenues declined 1.2% during the last fiscal year to $3.420 trillion. The recession lowered individual income tax receipts by 6.4% y/y to $1.61 trillion. Corporate tax receipts fell slightly more. Growth in social insurance tax payments eased to 5.4% y/y to $1.31 trillion and the reduction in global economic trade lowered customs duties by 3.2%.
Haver's data on Federal Government outlays are contained in USECON; detailed data can be found in the GOVFIN database. The Action Economics Forecast Survey numbers are in the AS1REPNA database.
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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