The following is an excerpt from Yuval Rosenberg | October 15, 2018 | Thefiscaltimes.com |
Despite a strong economy and robust job market, the federal budget deficit swelled to $779 billion in fiscal 2018, up $113 billion from 2017, according to final numbers released Monday by the Treasury Department.
The 17 percent increase from 2017 brought the deficit to the highest level in six years. As a share of the economy, the deficit was 3.9 percent, up from 3.5 percent the year before.
The deficit grew as tax revenues failed to keep pace with rising government spending. Revenues were roughly flat, up 0.4 percent over 2017, while spending increased by 3.2 percent, driven by higher spending on the military (up $32 billion, or 5.6 percent), Social Security (up $39 billion, or 3.9 percent), Medicaid (up $14.5 billion, up 3.9 percent) and disaster relief (up $12.4 billion, or 140 percent). Interest on the debt rose to $325 billion, up $62 billion over 2017.
Corporate income tax revenues fell from $297 billion to $205 billion. Individual income tax receipts, meanwhile, grew from $1.59 trillion to $1.68 trillion.
As a share of the economy, both revenues and spending were lower in 2018 than in 2017, but revenues fell more sharply, leading to the deficit increase.
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