A Surprise Trillion Dollar Deficit
According to the Congressional Budget Office, the federal government’s budget deficit for the first 11 months of its 2019 fiscal year was $1.067 trillion. During these months, the CBO reports, “revenues were $102 billion higher and outlays were $271 billion higher than in the same period in fiscal year 2018.”
It’s funny how the U.S. government can somehow collect a hundred billion more in taxes and yet still see the federal budget deficit grow even larger.
But there’s good news, because the CBO also expects the federal budget deficit to shrink so much during September that the government’s full 2019 fiscal year deficit will be only $960 billion. Niv Elis of The Hill reports:
The deficit presently stands at $1.068 trillion, though it is likely to be reduced in September as quarterly tax payments are paid.
“In its most recent baseline projections, CBO estimated that the 2019 budget deficit would be $960 billion,” the CBO noted. That amount would be $181 billion higher than last year’s deficit.
In truth, the surprise trillion dollar deficit for the first 11 months of fiscal 2019 really isn’t much of a surprise. Both the White House and congressional leaders knew this unbalanced situation was developing months ago, when it became clear that the U.S. government’s cash flow would become pinched at this time, with the credible risk the U.S. government could default on its debt payments to its creditors.
Their bipartisan response was the “worst budget deal in history,” in which they agreed they would solve the problem created and throw open the taps for their outlays and spending even more, fueled by additional borrowing.
That’s what passes for bipartisan budget logic in Washington, D.C., these days.