October 2019 Federal Deficit

The American Government’s fiscal year has begun, and the start is already deeper into the red than year ago.  During the first 31 days of fiscal 2020, our nation’s deficit reached $134.5 billion, rising 33.8 percent!  This quick dig deeper into the debt hole follows the nearly $1 trillion shortfall in 2019.

Both sides of the income statement worsened versus a year earlier.  Outlays jumped 7.6 percent to $370 billion.  Defense spending rose 7.5 percent from a year earlier.  Likewise, health related costs rose 9.9 percent.  Additionally, Social Security costs were 6.0 percent higher.  Interest payments were up 1.6 percent.

Unfortunately, the receipt side of things moved the other way, lower.  The nation brought in $245.5 billion, down 2.8 percent; personal tax revenue fell 1.9 percent year-over-year, and corporate taxes were down 17.9 percent.

America’s deficit has been an ongoing issue for decades.  Each year, our nation adds to its pile of debt by spending more than it receives.  Atlas is not sure about the timing but is convinced this will become an issue in the future, which will reverberate through our, and potentially the global, economy.  However, it doesn’t seem to matter in the short-run as markets are operating in an orderly fashion.