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| DATE | 2020-07-09 |
| FROM | Ruben Safir
|
| SUBJECT | Subject: [Hangout - NYLXS] QUnatifying the impact of COVID-19 coming into
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wsj.com
U.S. Budget Gap in June Nearly Matched Entire Fiscal 2019 Deficit
Kate Davidson
4-5 minutes
People lined up in Frankfort, Ky., as they sought help with unemployment
claims last month. Spending on the benefits surged in June.
Photo: bryan woolston/Reuters
Updated July 8, 2020 5:59 pm ET
WASHINGTON—The U.S. budget deficit totaled $863 billion in June, nearly
as much as the entire gap for fiscal year 2019, as federal spending
tripled to combat the coronavirus pandemic and tax revenues plunged, the
Congressional Budget Office said Wednesday.
Outlays soared to $1.1 trillion last month, nearly half of which went to
emergency small-business loans under the Paycheck Protection Program,
CBO estimated. Congress enacted the law in March to help small companies
meet payroll expenses and keep workers attached to their jobs.
Spending on unemployment insurance benefits also surged last month, as
millions of Americans remained out of work despite efforts by many
states to resume normal activity after months of widespread shutdowns.
Outlays for jobless benefits climbed from $2 billion in June 2019 to
$116 billion last month, nearly half of which was because of the extra
$600 in weekly benefits that Congress authorized as part of what is
known as the Cares Act. Those enhanced payments are set to expire at the
end of this month unless Congress chooses to extend them.
Spending for other safety-net programs also climbed last month as the
pandemic continued to weigh on economic activity, including outlays for
nutrition assistance, Medicaid and emergency funds for hospitals.
Federal revenues, meanwhile, sank 28%, to $242 billion, which the CBO
attributed to declining wages and reduced economic activity, which weigh
on tax collection, as well as the administration’s decision to delay
tax-payment deadlines until July 15.
Federal deficits typically deepen during economic downturns, as rising
unemployment pushes up spending on safety-net programs such as jobless
benefits and food stamps, and weighs on federal tax revenues. The U.S.
budget gap was already expanding—and was on track to exceed $1 trillion
in the fiscal year that ends Sept. 30—when the coronavirus pandemic hit.
Congress has since authorized $3.3 trillion in new spending to help
combat the virus, including stimulus checks to U.S. households and
emergency loans and grants to struggling businesses and state and local
governments.
For the first nine months of the fiscal year, the budget gap totaled
$2.7 trillion, the CBO said, more than triple the deficit during the
same period a year earlier. Total receipts fell 13% from October through
June compared with a year earlier, though all of the shortfall has
occurred since April. The CBO expects much of the deferred revenue will
be collected later this year, after individuals and corporations file
their tax returns by July 15. Total outlays during the period are up 49%
from a year earlier.
Write to Kate Davidson at kate.davidson-at-wsj.com
--
So many immigrant groups have swept through our town
that Brooklyn, like Atlantis, reaches mythological
proportions in the mind of the world - RI Safir 1998
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DRM is THEFT - We are the STAKEHOLDERS - RI Safir 2002
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Being so tracked is for FARM ANIMALS and extermination camps,
but incompatible with living as a free human being. -RI Safir 2013
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