The federal budget deficit was $509 billion in the first quarter of fiscal year 2024 (Oct.-Dec. 2023) - up $87 billion from the deficit recorded during the same period last fiscal year, the Congressional Budget Office (CBO) reported Tuesday.
Revenues were $83 billion (or 8%) higher, but outlays rose by $170 billion (or 12 percent), compared to year-ago’s first quarter.
Without shifts in the timing of certain federal payments, the first quarter deficit would have been even greater ($553 billion) - $94 billion more than the shortfall for the same period in FY2023.
Receipts totaled $1.1 trillion during the first three months of FY2024, CBO estimates—$83 billion more than during the same period a year before, largely due to the postponement until fiscal year 2024 of various 2023 tax deadlines for some taxpayers in federally-declared disaster areas.
Receipts from corporate income taxes increased by $44 billion (up 42%), aided by the postponement of tax payments, while state and gift taxes increased by $2 billion (up 29%).
Noteworthy increases in federal spending include:
- Net outlays for interest on the public debt were substantially higher, increasing by $73 billion (49%), primarily because of significantly higher interest rates.
- The outlays of the Federal Deposit Insurance Corporation (FDIC) rose by $62 billion as a result of facilitating the resolution of bank failures that occurred in 2023.
- Spending for Social Security benefits rose by $37 billion (12%), due to increases in the average benefit payment (stemming mostly from cost-of-living adjustments) and an increase in the number of beneficiaries.
- Medicare outlays increased, on net, by $25 billion (or 13 percent), largely because of increased benefit payments to Medicare Advantage plans.
Also on Tuesday, Rep. Victoria Spartz (R-Ind.) introduced a bill to establish a commission on national debt and fiscal reforms. The Debt Commission would be tasked with addressing “the dire fiscal situation before the next debt ceiling increase at the end of 2024,” Rep. Spartz said in a press release.
“The federal government has been mismanaging our finances for a while now, with our fiscal problems reaching catastrophic proportions,” Spartz said. “We either start now and put some thought into how we get out of this situation with the least amount of pain or have a major fiscal crisis in a few years drastically affecting the lives of many Americans.”
The business and economic reporting of CNSNews is funded in part with a gift made in memory of Dr. Keith C. Wold.