WASHINGTON: The U.S. government ran a budget surplus in June, leaving the budget deficit so far this year running under last year’s level.
The Treasury Department says the surplus in June totaled $51.8 billion, compared to a surplus of $70.5 billion a year ago. However, the larger 2014 monthly surplus was heavily influenced by a timing quirk that had moved June benefit payments into May last year because June 1 fell on a Saturday.
For the current budget year, the government is running a deficit of $313.4 billion, a 14.3 percent reduction from the imbalance over the first nine months of the previous budget year.
The Congressional Budget Office is forecasting that the deficit for the entire budget year will be $486 billion, about the same as last year. But some private analysts believe the CBO estimate is too pessimistic. Economists at Barclays Research said the June results support their projection that this year’s deficit will decline to $425 billion.
So far this year, government receipts total $2.45 trillion, 8.3 percent higher than the first nine months of the 2014 budget year. Government outlays total $2.76 trillion through June, 5.1 percent higher than the previous year.
The federal government’s budget year begins on Oct. 1 and ends on Sept. 31.
The 2014 deficit was down from $680.2 billion in 2013. Before then, the U.S. had recorded four straight years of annual deficits topping $1 trillion. That reflected the impact of a severe financial crisis and the worst recession since the Great Depression of the 1930s.
Those huge deficits drove the national debt higher. It currently stands at $18.1 trillion, right below the current debt limit. Since March, Treasury Secretary Jacob Lew has been making a series of moves to keep the government operating without going over the current limit while appealing to Congress to raise the borrowing limit.
Private economists have estimated that Lew can continue operating this way until October or November when the government faces the prospect of an unprecedented default on the national debt if the debt limit is not raised.
Republicans control both the House and Senate, and more conservative GOP lawmakers would like to use the need to raise the borrowing limit as leverage to force President Barack Obama to shift his policies in such areas as health insurance and immigration.
In addition to a potential default on the debt, the government could also face the prospect of another government shutdown if Congress fails to pass a budget by Oct. 1, the start of the new budget year.
It was a standoff over raising the debt limit in August 2011 that prompted the first-ever downgrade of the nation’s credit rating by Standard & Poor’s. And in October 2013, a dispute over the budget prompted a 16-day partial government shutdown.
