May Federal Deficit

The Treasury Department reported its federal budget deficit for May which surprised many by being less than expected.  Our government only spent $135,900,000,000 more than they collected in the month.  The country’s budget is on a fiscal year calendar which that begins every October, so we now have eight months on the books.  The Treasury has spent $935,000,000,000 more than it collected during the first two-thirds of the year.  Many have been quick to point out that this is an improvement over last year.  Fiscal year-to-date, the Treasury has reduced its deficit by 5.7%.  By this time last year the Treasury reported outlays of the federal government had totaled $2,365,086,000,000.  This year it has been cut to $2,281,556,000,000! While an improvement, the government still managed to spend 69.4% more than it has collected in taxes.  Imagine if you were to do the same and needed a loan to continue your profligate ways.  What bank would lend the money to you and, if you did find one to provide the advance, at what rate?  Some companies can get financing of this sort, but it is usually because they are developing and/or producing something of value.  Since the government is not in the business of production this indicator will remain at 6 o’clock until the growing deficit trend is reversed, and that will probably make for a long wait.