With a stunning $2.177 trillion flowing in from individual taxpayers alone, the intricate machinery of U.S. government finance, from its towering $6.1 trillion in annual spending to its nearly $34 trillion debt, reveals a system overwhelmingly funded by the American worker's paycheck.
Key Takeaways
- In fiscal year 2023, U.S. federal government individual income tax receipts totaled $2.177 trillion, representing 49.3% of total federal revenues.
- Corporate income tax receipts for the U.S. federal government in FY 2023 amounted to $420 billion, or 9.5% of total revenues.
- Payroll taxes (social insurance) contributed $1.585 trillion to federal revenues in FY 2023, making up 35.9% of the total.
- Total federal outlays in FY 2023 reached $6.134 trillion, or 23.6% of GDP.
- Social Security outlays were $1.347 trillion in FY 2023, 22% of total spending.
- Medicare expenditures totaled $839 billion in FY 2023, 13.7% of federal outlays.
- Total public debt outstanding for U.S. federal government was $33.17 trillion as of September 30, 2023.
- Debt held by the public was $26.63 trillion at end of FY 2023.
- Intragovernmental holdings of debt were $6.54 trillion in FY 2023.
- Federal budget deficit was $1.695 trillion in FY 2023, 6.3% of GDP.
- Primary deficit excluding interest was $1 trillion in FY 2023.
- Monthly deficit peaked at $309 billion in January 2023.
- U.S. state and local government total revenues were $3.3 trillion in FY 2022.
- State government own-source revenues reached $1.9 trillion in FY 2022.
- Local government revenues totaled $1.9 trillion including intergovernmental in FY 2022.
Individual income taxes accounted for nearly half of all federal government revenue last year.
Deficits and Surpluses
- Federal budget deficit was $1.695 trillion in FY 2023, 6.3% of GDP.
- Primary deficit excluding interest was $1 trillion in FY 2023.
- Monthly deficit peaked at $309 billion in January 2023.
- Cumulative FY2023 deficit through September was $1.7 trillion.
- Deficit as share of GDP averaged 5.5% from 2020-2023.
- FY2022 deficit was $1.375 trillion, down from $2.772T in 2021.
- Off-budget deficit contributed $250 billion to FY2023 total.
- On-budget deficit was $1.445 trillion in FY 2023.
- CBO projects FY2024 deficit at $1.9 trillion.
- 10-year cumulative deficit projection $20 trillion per CBO Feb 2024.
- Surplus last occurred in FY 2001 at $128 billion.
- Deficit financed 78% by domestic investors in 2023.
- FY2024 deficit projected 6.4% GDP by OMB.
- Structural deficit estimated $1.2T annually by CBO.
- Pandemic-era deficits averaged $2.5T yearly 2020-2022.
- Unified budget surplus/deficit reconciliation showed $1.7T gap FY2023.
- Cash basis deficit $2.0 trillion FY2023 per Treasury.
- FY2023 Q4 deficit $257 billion.
- Baseline 30-year deficit $112 trillion per CBO June 2024.
Deficits and Surpluses Interpretation
Even with the sugar-high of an off-budget snack, Washington's main course is still a whopping $1.7 trillion appetite for debt, a structural habit we're projected to finance for the next thirty years with roughly the GDP of the entire world.
Federal Debt
- Total public debt outstanding for U.S. federal government was $33.17 trillion as of September 30, 2023.
- Debt held by the public was $26.63 trillion at end of FY 2023.
- Intragovernmental holdings of debt were $6.54 trillion in FY 2023.
- U.S. federal debt as a percentage of GDP reached 99% in FY 2023.
- Interest payments on public debt were $875 billion in FY 2023 calendar year.
- Treasury bills outstanding totaled $5.8 trillion in Q4 2023.
- Treasury notes outstanding were $15.2 trillion as of end 2023.
- Treasury bonds outstanding amounted to $4.9 trillion in FY 2023.
- Mortgage-backed securities held by Fed contributed to debt dynamics in 2023.
- Foreign holders owned $8.0 trillion of U.S. public debt in Dec 2023.
- Japan held $1.1 trillion of U.S. Treasury securities in Dec 2023.
- China held $775 billion of U.S. Treasuries in Dec 2023.
- UK held $745 billion of U.S. debt securities in Dec 2023.
- Federal debt limit was suspended until Jan 2025 via FY2023 debt limit deal.
- Average interest rate on marketable debt was 2.5% in FY 2023.
- Unmatured marketable securities outstanding $26.3 trillion end FY2023.
- Gross federal debt increased by $2.3 trillion in FY2023.
- Public debt-to-GDP ratio projected to hit 122% by 2033.
- Average maturity of Treasury debt 70 months in 2023.
- TIPS inflation-protected securities outstanding $500 billion end 2023.
- SLGS securities for state/local debt management $200 billion.
- Mutual funds held $5.5 trillion Treasuries Dec 2023.
- Belgium held $350 billion U.S. Treasuries Dec 2023.
- Ireland foreign holdings $300 billion U.S. debt 2023.
- State/local govts held $1.2T intragov debt equivalent.
- Weighted avg interest rate on total debt 2.4% FY2023.
Federal Debt Interpretation
With an astonishing 99% of GDP now spoken for by our national IOU and our government essentially borrowing over $6 million per minute just to cover last year's interest tab, we've perfected the art of using tomorrow's prosperity to pay for yesterday's spending.
Federal Expenditures
- Total federal outlays in FY 2023 reached $6.134 trillion, or 23.6% of GDP.
- Social Security outlays were $1.347 trillion in FY 2023, 22% of total spending.
- Medicare expenditures totaled $839 billion in FY 2023, 13.7% of federal outlays.
- Income security programs cost $807 billion in FY 2023, including unemployment and food assistance.
- National defense spending was $820 billion in FY 2023, 13.4% of total outlays.
- Net interest on the debt was $659 billion in FY 2023, 10.7% of federal spending.
- Veterans benefits outlays reached $301 billion in FY 2023.
- Education spending by federal government was $79 billion in FY 2023.
- Transportation outlays totaled $109 billion in FY 2023.
- Community and regional development spending was $63 billion in FY 2023.
- Federal health outlays excluding Medicare were $225 billion in FY 2023.
- Agriculture subsidies cost $32 billion in FY 2023.
- Justice administration outlays were $57 billion in FY 2023.
- International affairs spending totaled $60 billion in FY 2023.
- General science, space, and technology outlays were $40 billion in FY 2023.
- Federal discretionary spending was $1.7 trillion in FY2023.
- Mandatory spending dominated at $4.1 trillion or 67% of FY2023 outlays.
- DOD base budget $773 billion in FY2023 enacted.
- HHS outlays excluding Medicare $1.8 trillion in FY2023.
- SNAP food assistance cost $119 billion in FY2023.
- Federal highway spending $52 billion in FY2023.
- Energy Department outlays $48 billion FY2023.
- NASA budget executed $25 billion in FY2023.
- Treasury Department administrative costs $12 billion FY2023.
- Federal employee retirement benefits $108 billion FY2023.
- Housing assistance outlays $62 billion FY2023.
Federal Expenditures Interpretation
The federal budget for 2023 paints a stark picture of a nation primarily funding its promises from the past—with Social Security, Medicare, and debt interest consuming nearly half of all spending—while its investments in the future, like education, science, and infrastructure, collectively amount to little more than a rounding error.
Federal Revenue
- In fiscal year 2023, U.S. federal government individual income tax receipts totaled $2.177 trillion, representing 49.3% of total federal revenues.
- Corporate income tax receipts for the U.S. federal government in FY 2023 amounted to $420 billion, or 9.5% of total revenues.
- Payroll taxes (social insurance) contributed $1.585 trillion to federal revenues in FY 2023, making up 35.9% of the total.
- Excise taxes generated $87 billion in FY 2023 for the U.S. federal government, accounting for 2.0% of revenues.
- Estate and gift taxes brought in $34 billion to federal coffers in FY 2023, or 0.8% of total revenues.
- Customs duties collected $80 billion in FY 2023, representing 1.8% of U.S. federal revenues.
- Miscellaneous receipts totaled $142 billion in FY 2023 for the federal government, 3.2% of revenues.
- Federal individual income tax withholding was $1.786 trillion in FY 2023.
- Federal corporate income tax from refunds netted $419 billion in FY 2023.
- Social Security tax receipts reached $1.235 trillion in FY 2023.
- Medicare tax collections were $350 billion in FY 2023 for the federal government.
- Unemployment insurance taxes contributed $48 billion in FY 2023.
- Federal Reserve earnings remitted $116 billion to the Treasury in FY 2023.
- In FY 2022, total federal revenues were $4.896 trillion, up 7% from prior year.
- Individual income taxes were 50.4% of federal revenues in FY 2022.
- U.S. federal revenues as a percentage of GDP were 17.4% in FY 2023.
- In fiscal year 2023, U.S. federal government revenues from individual income taxes increased by 12.2% to $2.177 trillion.
- Federal payroll taxes grew 5.8% in FY2023 to $1.585 trillion.
- Corporate tax receipts rose 6% to $420 billion amid economic recovery in FY2023.
- Total federal revenues hit $4.439 trillion in FY2023, 17.4% of GDP.
- Excise taxes on alcohol and tobacco totaled $12 billion in FY2023.
- Federal revenues from tariffs averaged $80 billion annually post-2022.
- In FY2021, federal miscellaneous receipts included $200 billion from spectrum auctions.
- Social insurance taxes as % of GDP were 6.0% in 2023.
Federal Revenue Interpretation
America runs on a three-part fuel mix of tapped workers, subsidized corporations, and the deferred promises of Social Security and Medicare.
State and Local Finances
- U.S. state and local government total revenues were $3.3 trillion in FY 2022.
- State government own-source revenues reached $1.9 trillion in FY 2022.
- Local government revenues totaled $1.9 trillion including intergovernmental in FY 2022.
- Property taxes generated $623 billion for state/local in FY 2022, 28% of own revenues.
- Sales and gross receipts taxes were $524 billion in FY 2022 for states/locals.
- Individual income taxes at state level totaled $524 billion in FY 2022.
- Federal intergovernmental transfers to states/locals $887 billion in FY 2022.
- State/local expenditures totaled $3.7 trillion in FY 2022.
- Elementary/secondary education spending by states/locals $885 billion FY2022.
- Public welfare outlays by states $574 billion in FY 2022.
- Hospitals spending at local level $174 billion FY2022.
- State/local debt outstanding $3.2 trillion in FY 2022.
- California state budget revenues $288 billion in FY2023.
- New York City local revenues $102 billion FY2023.
- U.S. states had combined budget surplus of $120 billion in FY2022.
- Local government property tax collections up 4.5% to $623B FY2022.
- State aid to local governments $731 billion FY2022.
- Pensions funded 72% at state/local level per 2022 data.
- States reported $81B surplus entering FY2023.
- Local govt utilities revenue $250B FY2022.
- Texas state sales tax $35B FY2023.
- Florida no income tax, property taxes $25B local FY2022.
- State/local capital outlays $450B FY2022 infrastructure.
- Pensions unfunded liabilities $1.5T state/local 2022.
State and Local Finances Interpretation
The numbers paint a picture of a massive, interconnected financial engine—one where property owners and shoppers are the dependable fuel, federal transfers are the essential lubricant, and yet the machine still runs hot, spending more than it takes in while trying to outpace the growing shadow of pension debt.
Sources & References
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