March Federal Deficit $188 Billion, Bringing Six Month Total to $829 Billion

The U.S. is well on its way to another record year of deficits besting those of 2009 and 2010; the current pace shows an excess of $1.6 Trillion in deficit spending for fiscal 2011.  With U.S. GDP of roughly $14.6 Trillion (via IMF) this is an 10.9% annual deficit – astounding.

To put these figures in perspective prior to the past few years the record was $400 Billion.  Hence the variance between “then” (which was a record) and “now” is $1.2 Trillion – similar to the figures the past 2 years.  For those applauding the “miracle” that is the U.S. economy (moaning and groaning along at 2.5-3.25% growth), I ask you to take out $1.2 Trillion (i.e. the growth versus previous records) off a $14.6T base and think about what the organic economy would look like without this superlative spending spree.

Or to simplify it more, $1.6 Trillion is more than the entire economic output of Canada; the world’s 9th largest economy.

(as an aside the more I read about the $38B in ‘cuts’ our fearless leaders just agreed to, much of it sounds like accounting gimmickry and/or reductions in programs that were already frozen and could not be tapped – either way in light of the deficit you can see $38B is a bit of a joke – it’s about 1 week of the annual deficit)

  • The U.S. government recorded a budget shortfall of $188 billion in March, the Treasury Department said Tuesday in a report likely to add new fuel to the raging political debate about government debt and spending.
  • ….brings the deficit to $829 billion for the first six months of fiscal 2011.  This compares with $717 billion the prior fiscal year to date.
  • The government spent $339 billion in March, according to the Treasury report, and took in nearly $151 billion.
  • For the first six months of fiscal 2011, the government has spent about $1.85 trillion. Receipts for the first half of the year are $1.02 trillion.
  • The IMF projected that the U.S. will have a fiscal balance as a percentage of GDP of -10.8% in 2011, the biggest percentage among advanced countries.

“We’re #1!”

About Mark Hanna 543 Articles

Affiliation: Hanna Capital, LLC

Mark Hanna is President and Owner of Hanna Capital, LLC, a registered investment advisory firm. Mark has been a follower of markets since the late 80s, with a focus on individual equities since the mid 90s. He has been a well known commentator in the financial blogosphere for the past 5 years, following a career in corpoporate finance and accounting. Mark attended the University of Michigan where he graduated with a degree in Economics.

As an avid reader, Market Montage is the personal blogging site for Mark to share his views on economics, markets, and the like. Occasional cynicism and wit shall be deployed in his postings.

Follow Mark on Twitter @fundmyfund.

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