The federal government ran a deficit of $203 billion in November 2018. The Congressional Budget Office (CBO) estimates that it was only $64 billion more than the deficit in November 2017. Outlays in November were affected by shifts in the timing of federal payments that otherwise would have been due on a weekend. This increased outlays by $45 billion. If not for those calendar quirks, the deficit would have been $158 billion, a whopping $19 billion more than the deficit in November 2017. The actual deficit in October 2018 was $100 billion – in other words double our U.S. non-money.
Not that it matters according to traditional Republican double-speak. Such gigantic deficits are only a problem if they occur when the Democrats are in power. When Republicans cut taxes for the wealthiest and run up huge deficits it’s – don’t laugh – good for the economy. Worse, the federal budget deficit was $303 billion for the first two months of fiscal year 2019, says CBO. That’s $102 billion more than the deficit recorded during the same period last year. Revenues and outlays were higher, by 3% and, ahem, 18%, respectively, than in October and November 2017.
Because December 1, 2018, fell on a weekend, this year’s outlays were boosted by the shift of some payments from December to November. Although last year’s outlays for the same period were reduced by a similar amount because of payment shifts from October 2017 into fiscal year 2016. (October 1, 2017, the first day of fiscal year 2017, also fell on a weekend). If not for those timing shifts, outlays and the deficit through November would have been larger last year and smaller this year. Outlays so far this year would have been $27 billion, or +4% larger than those in the same period last year, and the deficit would have risen by $13 billion.
Total Outlays: +18% in the First Two Months of Fiscal Year 2019
Outlays for the first two months of fiscal year 2019 were $761 billion, +$115 billion higher than they were during the same period last year, CBO estimates. If not for the shift of payments from October to September 2018 (which reduced outlays in the first two months of fiscal year 2017) and from December to November 2018 (which increased outlays for the same period in fiscal year 2018) that year-to-year increase would be smaller but still problematic at $27 billion rather than $115 billion.
The largest increases in outlays were:
- Outlays for the largest mandatory spending programs increased by 2%:
- Social Security benefits rose by $8 billion (or 5%). because of increases both in the number of beneficiaries and in the average benefit payment.
- Medicare and Medicaid outlays were about the same as last year.
- Outlays for net interest on the public debt increased by $5 billion (or 8%). because interest rates are substantially higher in 2019 than they were during the same period in 2018 and the amount of federal debt is larger than it was a year ago.
- Spending for military programs of the Department of Defense rose by $9 billion (or 9%) mostly in the area of operation and maintenance.
- Outlays for the Department of Veterans Affairs increased by $5 billion (or 17 %) because of a rise in the number of disability compensation beneficiaries and an increase in the average benefit payment.
The Largest Decreases in Outlays:
- Outlays recorded for the Department of Homeland Security decreased by $7 billion (or 41%) largely because spending for disaster relief was greater than usual (climate denial?) in the fall of 2017.
- Spending by the Department of Agriculture decreased by $4 billion (or 10%) largely because of lower payments to farmers by the Commodity Credit Corporation.