March 2011 Federal Deficit

As the Treasury Department closes the books for March, we have reached the halfway point of our nation’s fiscal year.  The checking account didn’t come into balance.  No surprise there.  The shortfall for the month, at $188.2 billion, pretty much met expectations.  With six months under our belt the total 2011 deficit is reported to be $829.4 billion, making it a 15% deeper hole than what was experienced last year at this time.

Obviously outlays are running higher at an increasing rate.  Special items like the government’s housing and economic recovery programs are adding to the burden.  Net interest expenses up 10% so far year-to-date are making themselves felt as well.  Receipts are growing at a much slower 7% clip, but it’s not your fault.  Individual taxes have risen 21%, proving you are doing your share.

A much dented can is continuing to be kicked down the proverbial road as Congress cobbles together short-term extensions to prevent a government shutdown.  This has, of course, been a standing issue dating back well before the most recent election.  If they couldn’t achieve a balanced budget last year when one party held sway over both House and Senate, I wonder what more we can expect now.  Unfortunately, the only thing that seems to be baked into the cake is higher interest rates.  If that happens, things could get worse even faster than the budget calls for.