U.S. to run first budget SURPLUS since 2008: CBO

[Cheezy the Wiz]

Well, there goes the election! The deficit is probably the GOP's biggest talking point, because it's central to characterizing Obama's Administration as having an ongoing problem as spending hawks who can't manage finances.


This seems really strange, though. I didn't think we'd cut taxes or raised revenue that much. So where did this come from? When I read this, I can't help but feel a bit apprehensive, like this headline is the result of some fanciful and selective data manipulation or careful word order.

http://www.marketwatch.com/story/us-to-run-first-surplus-since-2008-cbo-2012-05-07?reflink=MW_news_stmp

WASHINGTON (MarketWatch) — The U.S. government recorded a budget surplus of $58 billion in April, the Congressional Budget Office estimated on Monday, breaking a streak of deficits that began in 2008.

The surplus — the first of Barack Obama’s presidency — was the result of both increased tax collection and lower government spending. Before April, the government had not run a surplus since September 2008, the month that the financial crisis struck the U.S. economy.

The CBO’s estimate is released before the Treasury Department’s monthly budget report. That report is scheduled for later this week.

CBO estimated that receipts were $30 billion higher in April than the same month a year ago, due to declining refunds that month and higher corporate income tax receipts. Spending fell by $69 billion compared to April 2011, marked by lower outlays on defense, Medicaid and the Postal Service.

Government spending and deficits are shaping up to be a main issue in the presidential campaign, and the monthly surplus is a piece of good news for Obama.

For the first seven months of the fiscal year, the CBO estimates that the Treasury will notch a deficit of $721 billion. That’s $149 billion less than the red ink reported for the same period in fiscal 2011.

The improved budget picture will not put an end to election-year sparring about the deficit, however. The U.S. is running a debt of $15.7 trillion, a number often pointed out by Obama’s Republican critics, including White House hopeful Mitt Romney.

 

[rugbyLEAGUEfan]

Being a politician is a sweet gig .

Run a deficit and put me into debt without my consent . Get re-elected by spending deficit on trinkets to keep me calm .

Run a surplus and don't share the money you took from us . Get plaudits for being responsible

 

[Cheezy the Wiz]

Being a politician is a sweet gig .

Run a deficit and put me into debt without my consent . Get re-elected by spending deficit on trinkets to keep me calm .

Run a surplus and don't share the money you took from us . Get plaudits for being responsible

Well we elected them, so it is presumed to be consensual. The downsides of representative democracy.

 

[rugbyLEAGUEfan]

That's one mighty presumption . Today I elected to pay $4.50 to use the expressway instead of take the log jammed , pot holed alternate route( which my taxes also contributed to) . It didn't feel too consensual . I certainly didn't get that "next year I'll vote for the other guy and I won't take one in the rear while driving to work" feeling

 

[Cheezy the Wiz]

That's one mighty presumption . Today I elected to pay $4.50 to use the expressway instead of take the log jammed , pot holed alternate route( which my taxes also contributed to) . It didn't feel too consensual . I certainly didn't get that "next year I'll vote for the other guy and I won't take one in the rear while driving to work" feeling

If you're looking for a defense of the two-party system from me, you won't get it.

 

[rugbyLEAGUEfan]

If you're looking for a defense of the two-party system from me, you won't get it.

I figured as much , but there wasn't much happening elsewhere and I hoped you might humor me

 

[Cheezy the Wiz]

Well I think you raise a good point, that their profligance will likely be "forgiven" by the public because they shaped up in the end, though I can see this being sold as done by a Republican Congress (even though it isn't) as part of the 2010 mandate to fix problems the Democratic Congress had previously created.

 

[amadeus]

Let's say that in May I spend $10,000 and only make $2,000.
Now in June, I spend $1,000 and make the same $2,000.
Then in July, I spend $10,000 again, still making the same $2,000.

Am I in the black or the red?

 

[Cheezy the Wiz]

No one has suggested there isn't still a substantial debt.

 

[rugbyLEAGUEfan]

No one has suggested there isn't still a substantial debt.

That's the beauty of the job . By the time it's time to pay it back , you're in the Bahamas on a lifetime pension with perks

 

[Crezth]

usa #1

 

[amadeus]

It's not even the debt, it's the deficit for the fiscal year. The deficit forecast for the year is still over a trillion dollars.

 

[useless]

In before "obama had nothing to do with this/it was bushes plan" etc.

Hopefully this will mean Obama will be re-elected.

 

[downtown]

Yeah, I don't think this really matters very much. Running a monthly surplus is nice, but even if we put the entire balance of this month's surplus towards the debt, it wouldn't make THAT much of a dent.

 

[Bestbank Tiger]

This seems really strange, though. I didn't think we'd cut taxes or raised revenue that much. So where did this come from? When I read this, I can't help but feel a bit apprehensive, like this headline is the result of some fanciful and selective data manipulation or careful word order.

My guess would be it's because April 17 was the tax deadline this year, so most people who underpaid during 2011 had to send in a check. If you owe them, you're probably going to make them wait.

On the other hand, refunds wouldn't all go out in April because if the government owes you money, you're not going to wait to send in your return.

 

[Cheezy the Wiz]

It's not even the debt, it's the deficit for the fiscal year. The deficit forecast for the year is still over a trillion dollars.

Yeah, I don't think this really matters very much. Running a monthly surplus is nice, but even if we put the entire balance of this month's surplus towards the debt, it wouldn't make THAT much of a dent.

Erm, by "in April" I thought they meant "once we got all our tax stuff done for last year." They meant just for the month of April?

 

[kochman]

Let's say that in May I spend $10,000 and only make $2,000.
Now in June, I spend $1,000 and make the same $2,000.
Then in July, I spend $10,000 again, still making the same $2,000.

Am I in the black or the red?

Exactly...
I think Cheezy is missing the point. The last surplus was in Sept 2008.

Under Bush... who ran huge deficits overall in 2008...
A one month surplus is entirely meaningless... sustained surplus is what we need.

 

[timtofly]

Erm, by "in April" I thought they meant "once we got all our tax stuff done for last year." They meant just for the month of April?

April would be the month they would come in even quarterly from corporations. The economy was a little stronger and thus less extensions may have been filed. Thus April would be the worse month to show surplus in terms of continuance, but it would make Obama look good.

 

[Cutlass]

Erm, by "in April" I thought they meant "once we got all our tax stuff done for last year." They meant just for the month of April?

That's what it appears to be. What you are seeing is an artifact of the fact that government revenues are not the same every day or month of the year, but rather that they go up and down based on other factors. In this case, people pay all their back taxes in April. So there's an annual surge in revenue. It does not imply that the budget is in surplus for the year as a whole.

 

[luiz]

There's not much point in looking at a single month when talking public finances. A number of factors might distort thing in the short term.

The year-end projection for the US budget is still a gigantic deficit.