U.S. budget deficit surpasses $1 trillion as government spending climbs
The U.S. government's budget deficit for the 2019 fiscal year surpassed the $1 trillion benchmark in August, the highest level in seven years, the Treasury Department said Thursday.
The government budget deficit climbed $169 billion to $1.07 trillion in the first 11 months of this budget year, as government spending this year outpaced tax collections in areas such as Social Security, Medicare, defense and interest payments on the national debt. With just one month left in the budget year, the deficit is up 18.8% over the year-ago period, according to the Treasury Department.
Budget experts projected a surplus for September, which would push the total 2019 deficit down slightly below the $1 trillion mark for the fiscal 2019 year. The Congressional Budget Office is forecasting a deficit this year of $960 billion, compared to $779 billion last year.
Longer term, the CBO in August forecast that the annual deficit would again top $1 trillion in 2020 and remain above that threshold over the next decade .
While the deficit has risen, the U.S. economy also has continued to expand, swelling from roughly $16 trillion in 2012 to more than $21 trillion as of the second quarter of this year.
Higher government spending
The government has recorded trillion-dollar-plus deficits in only one other period — between 2009 through 2012, when federal spending shot up to cope with the worst financial crisis since the 1930s.
The higher deficits currently reflect higher government spending, reflecting two budget agreements in 2018 and this year between the Trump administration and Congress that added billions of dollars in extra spending for the military and domestic programs.
In addition, Social Security and Medicare payments are surging as millions of baby boomers retire. Added to the increased spending is the impact of the $1.5 trillion tax cut President Donald Trump pushed through Congress in 2017, reducing individual and corporate tax rates.
For this year, revenues are up 3.4%, but spending is up by 7%, nearly double the increase in revenues. Individual tax revenues have risen by 2% in the first 11 months of this year compared to the same period in 2018 while corporate tax revenues are down 2%.
Bucking this slow growth are tariffs which are up $28 billion or 73% over last year, reflecting the higher tariffs Trump has imposed on China and other nations as part of his get-tough trade battles.
On the spending side, the government so far this year has spent $379.1 billion on interest payments on the debt, up $47 billion from a year ago, reflecting the growing size of the national debt.
Commenting on the new report, Michael Peterson, head of the Peterson Foundation, said, "Absent more responsible budgets, the deficit and interest costs will continue to grow rapidly, diminishing America's future."
When I consider irresponsible politicians the first thing that comes to my mind is the debt; next to that is the deficit. This is so beyond irresponsible I am at a loss to offer an appropriate adjective.
Adjective smadjective.
What's worse?
Don't worry a pound.
As soon as Mexico pays for that unnecessary wall he promised his suckers, he'll have them take care of that minor oversight, also called a LIE, about balancing the budget.
That "middle class" less, tax cut for the wealthiest is doing just fine for the ones who needed it most least, the divine
Intervention is not going to be coming from anywhere,
till people realize the tire d, isn't despair , and what Trump spews
is just more hot air, cause he only ever did care,
about no one, in the middle class, as he has always been, ONE way fare.
Trump actually promised to eliminate the entire NATIONAL DEBT.
So I guess a trillion dollar DEFICIT is his way to achieve debt reduction.
Sounds legit, doesn't it?
yepp.. the globalists in both parties have been screwing us over big time. the only thing more expensive than that is undoing 60+ yrs of traitors running our govt.
there is no reason we should be paying interest on our money. fuk the federal reserve. the sooner we end that bs the better.
seems one party, is a torque head, while the other, stripped
How is the government going to borrow money if they don't pay interest on the fucking bonds?
Yes I think Trump should not sign on to anymore of the runaway spending congress sends back to him after they reject his proposed budget cuts. He should just let the government shut down rather than rubber stamping their bills.
“The Trump administration released its 2020 budget request on Monday , proposing major cuts to federal government spending. While the cuts are unlikely to become reality — Congress has rejected many of Trump’s previous requests”
Wally, it was a republican congress for the first two years trump was in office. Nothing to do with the dems.
The seeded article points out that Federal tax revenue increased by 3.4 pct. Kinda difficult to argue that the deficit is driven by tax cuts when the government is taking in more money.
And Social Security cannot increase the deficit because the program is prohibited from paying benefits from general revenue. SoSec is still paying for itself and still has a large surplus in the trust fund. So, blaming Social Security for the deficits is, at best, a lie.
Everything really does show that the deficits are caused by spending too much rather than taxing too little. Politicians have been promising to spend money now and raise taxes later. That's putting the cart ahead of the jackass.
Reagan said he would use "trickle down economics" to balance the budget by 1983. Instead he set the record for the highest deficit in history.
Daddy Bush ran an even higher deficit and broke Reagan's record.
Bill Clinton set the record for the highest budget surplus in U.S. history.
DuhBya broke his daddy's record and ran an even higher deficit.
Obama managed to reduce GW's deficit.
Trump is on his way to running a new record high deficit .
The Democrats did nothing of the sort.
Tell us exactly how they got those alleged numbers
Cut programs, raised taxes, how??
Clinton had a "projected" surplus that never occurred.
Look it up.
Yes the numbers Pelosi is sending to Trump for approval do not make for a balanced budget. Do you think he should have rejected Pelosi’s spending deal and go for the shutdown? I think he should have told her to take a hike and come back when she has a balanced budget for him to sign.
Trump submitted a budget with a huge deficit.
Yea, it kinda did.
Scroll down to 2000, what does it say?
The table shows a surpluses in 1998 ($69 Billion), 1999 ($126 Billion), 2000 ($236 Billion) and 2001($128 Billion).
In 2002 GW's trickle down ended the budget surpluses ( $158 Billion deficit ).