Did the U.S. just have the best revenue month ever?

I suppose if we want some good news to pass the time this week we could look at the country’s tax receipts and total revenue picture for the previous month. (The “good news” part of it comes with a couple of qualifiers, however.) As the Washington Times noted this week, the United States just finished recording the largest monthly budget surplus in our nation’s history.

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The federal government took in a record tax haul in April en route to its biggest-ever monthly budget surplus, the Congressional Budget Office said, as a surging economy left Americans with more money in their paychecks — and this more to pay to Uncle Sam.

All told the government collected $515 billion and spent $297 billion, for a total monthly surplus of $218 billion. That swamped the previous monthly record of $190 billion, set in 2001.

CBO analysts were surprised by the surplus, which was some $40 billion more than they’d guessed at less than a month ago.

Analysts said they’ll have a better idea of what’s behind the surge as more information rolls in, but for now said it looks like individual taxpayers are paying more because they have higher incomes.

So we can answer the title question in the affirmative. A monthly budget surplus of more than $200B is nothing to sneeze at, and the fact that this haul exceeded predictions by $40B is a sign of a stronger economy, higher employment and more spending by consumers. These are all positive signs.

You knew there was a “but” coming here, right? Well, there is. Despite this being a solid month for the beancounters, we should keep in mind that the month in question was April. That’s almost always the highest revenue month because that’s when everyone who owes taxes to Uncle Sam gets around to filing their returns and writing the check. (People getting a refund tend to file immediately.)

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For some recent historical perspective, we can take a look at the previous fiscal year. In this report from the Treasury Department, scroll down to locate “Table 1. Summary of Receipts, Outlays, and the Deficit/Surplus of the U.S. Government, Fiscal Years 2017 and 2018, by Month.” You’ll see that during the last fiscal year, in April of 2017, the country logged a surplus of $182.4B. But in the month preceding that we ran a deficit of $176B and in the following month (May) we went another $88B in the hole. So April is clearly an outlier in most years.

In case you’re thinking that things were looking up just because Trump came to town, the same pattern was observed under Obama. In this matching table for 2016, April brought us a $156B surplus. But March and May delivered $52.9B and $84B deficits respectively.

That’s not to say that the current administration isn’t delivering better results. If the April surplus from 2016 through 2018 jumped from $156B to $218B, that’s an increase far beyond what we would expect just from normal population growth and a larger workforce. But the overall projections for the entire year still haven’t changed. We’re going to have some vast deficit months unless the country’s economic engine seriously catches fire well beyond the levels we’re seeing now. If you want that situation to change, we have to cut spending significantly in addition to maintaining near full employment levels and slowly rising wages. That might be why the President just called for clawing back $15B from the budget. It’s not nearly enough to close the gap, but at least it’s a start.

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Beege Welborn 5:00 PM | December 24, 2024
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