The federal government set an all-time record for monthly tax receipts this past April. The Congressional Budget Office (CBO) reported that nearly a half-trillion dollars was received — $472 billion to be exact. April is typically a high revenue month because yearly taxes are due on April 15th, but this April was the largest tax receipt in history. It beat the last year’s April tax haul –which was the prior record– by $58 billion ($414B).
With such a large amount of revenue, spending was below tax intake — meaning the government ran a surplus, and a record one at that as well. It was a $155 billion surplus for one month. That will help reduce the overall deficit expected for the year. According to the CBO, “the government has taken in $1.89 trillion in revenue, and spent $2.18 trillion through the first seven months of the fiscal year.” The fiscal year runs October 1 – September 30.
The most interesting part of the CBO report, however, was the portion on entitlement spending:
“The biggest spending increases are in Medicare, Medicaid and Social Security — the big entitlement programs that are essentially on autopilot, with costs increasing as more poor, disabled and elderly people become eligible. Combined, they are up some $81 billion compared to the same time period from fiscal year 2014.”
“Social Security has risen 4 percent this year, and Medicare has risen 8 percent, after unanticipated spending increases in 2014 left the government with a big bill at the beginning of this fiscal year.
But the biggest leap has been in Medicaid, the federal-state partnership that provides health care to the poor, and which is up 22 percent, or $36 billion, over the previous year. CBO analysts said the increase was chiefly due to Obamacare, which has pushed millions of new customers into the program, drawing ever-more resources.”
This is the elephant in the room. Entitlement spending is not even “counted”, so to speak, when discussing the $18 trillion federal debt. But until we agree to start recording Social Security, Medicare, and Medicaid in their budgets in actuarially sound way, we will never be able to honestly and effectively deal with their fiscal crises. All of these programs needs massive reform instead of incrementally kicking the can further down the road to avoid making difficult, but necessary changes for the long haul. Until then, deficit spending will only continue to worsen and revenue taken from the taxpayer to cover the government’s spending habits.