US Budget Deficit Widens 77% in First 4 Months of Fiscal 2019

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The US budget deficit is up 77% unadjusted, but "only" 40% after factoring in timing considerations.

US tax revenues are down and spending is up. The net result speaks for itself: U.S. Budget Gap Widened 77% in First Four Months of Fiscal Year.

The government ran a $310 billion deficit from October through January, compared with $176 billion during the same period a year earlier, a 77% increase, the Treasury Department said Tuesday.

Federal outlays climbed $115 billion, or 9%, in the first four months of fiscal 2019, which began Oct. 1, driven by higher spending on the military, veterans’ affairs and interest on the debt. Total receipts declined $19 billion, or 2%, due to weaker corporate and individual income-tax collection.

Part of the percentage increase in the deficit was attributable to a shift in the timing of certain payments, which made the deficit appear smaller in the first four months of fiscal year 2018, the Treasury said. If not for those timing shifts, the deficit would have risen 40.2% so far this fiscal year.

On a 12-month basis, government revenues declined 1.5%, while outlays have risen 4.4%. The budget deficit rose to $913.5 billion for the 12 months ended January, or 4.4% of gross domestic product.

Comment of the Day

My award for comment of the day goes to Director Keith Hall of the nonpartisan Congressional Budget Office.

It’s hard to imagine this is sustainable,” said Keith Hall

Indeed.

Mike "Mish" Shedlock

Comments (29)
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Curious-Cat
Curious-Cat

VAST majority? Numbers please. Don't forget to exclude social security recipients who already paid into the system.

QTPie
QTPie

Smoke-and-mirrors accounting... These deficit to GDP percentages are bogus becuase they exclude a bunch of stuff. The difference between the beginning and ending debt-held-by-the-public numbers across any one year span is higher than the “headline” deficit number for the same timeframe. This means that in reality we’re running more than a 4.4% deficit.

truthseeker
truthseeker

Ok could all of America’s many deficits, the 21 trillion dollar budget deficit, this years trillion dollar deficit whatever it will be, our massive trade deficit, corporate debt, consumer debt be the answer to the question of why would someone buy a 10 year German bund with a yield of .156 against a yield of 2.72 on our 10 year note?

Esclaro
Esclaro

And they said MMT would never work!

BillSanDiego
BillSanDiego

According to the US Treasury report, at www.treasurydirect.gov, the debt increased by $375.47 billion from 10/1/18 to 1/31/19.

truthseeker
truthseeker

To answer my own question, of course, the person who is buying the 10 year German bund has to expect that all this unbelievable dollar debt will sooner or later cause the dollar to eventually collapse IMO.

Greggg
Greggg

“It’s hard to imagine this is attainable,”

KidHorn
KidHorn

Part of it is rising interest rates and part is people not withholding as much, as is evidenced by their shock over having to pay more taxes this year. Not defending out of control spending, but it's not as bad one would gather.

Casual_Observer
Casual_Observer

If interest rates go to .0000001% then debt turns out not to grow. As R approaches 0 then interest on the debt is effectively 0. Then we find out if our owners actually want us to pay them the principle.