Global| May 12 2021U.S. Government Budget Deficit Widens in April
by:Tom Moeller
|in:Economy in Brief
Summary
• Budget deficit exceeds expectations. • Coronavirus-related outlays balloon. • Individual tax receipts strengthen with economic improvement. The U.S. Treasury Department reported a federal budget deficit of $1.932 trillion for the [...]
• Budget deficit exceeds expectations.
• Coronavirus-related outlays balloon.
• Individual tax receipts strengthen with economic improvement.
The U.S. Treasury Department reported a federal budget deficit of $1.932 trillion for the first seven months of FY 2021. This compares to a $1.481 trillion deficit over the same period last year. For April alone, the deficit totaled $225.6 billion compared to expectations in the Action Economics Forecast Survey for a $130 billion deficit. One year ago, the first round of COVID-19 stimulus checks to individuals produced an April '20 deficit of $738.0 billion.
Federal government outlays have risen 22.5% y/y so far in FY'21. The increase includes a 95.3% surge in income security payments due to coronavirus relief payments, economic stimulus checks and outlays related to a higher unemployment rate. Spending on health programs grew 13.0% y/y so far this fiscal year. Social Security payments increased 3.8% y/y and defense outlays rose 6.6% y/y so far in FY'21. Medicare payments fell 9.5% y/y, due to calendar year differences, and interest payments fell 13.6% y/y so far in FY'21.
Overall revenues have increased 16.1% y/y so far this fiscal year. Individual income tax payments jumped 20.1% y/y in FY'21 due to improved economic growth while corporate tax payments demonstrated even more strength. Social insurance taxes rose 3.6% y/y, but the reduction in global economic trade lowered growth in customs duties to 1.1% y/y in FY'21.
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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