The US budget deficit has increased another $119.7 billion, which is 27% higher than it was this time one year ago, according to CNBC.
Government spending increased 22.8% whereas revenue increased 11.6%. This brings the fiscal year deficit to $866.8 billion, a year and a half after President Donald Trump’s $1.5 trillion tax cut which he said would pay for itself. At this time last year, the deficit was $684 billion.
There are two months left in the fiscal year, and the Treasury Department projects a deficit of over $1 trillion.
Trump’s tax cut lowered the rate corporations have to pay from 36% to 21%, but tax receipts are up 3.2% this year. Individual income tax receipts have risen just over 1%. However, this hardly put a dent in government spending.
The deficit increase was largely a result of increased spending on health care and the military. Medicare outlays rose 11% to $66 billion, and defense spending rose $10 billion to $53 billion in total.
The two-year budget deal Trump negotiated with Congress will add to the deficit, with its increase of spending on military and domestic programs.
The federal budget deficit first broke $1 trillion in 2009, weighing in at $1.4 trillion, when the government attempted to stir an economy in recession, according to the Congressional Budget Office. This was three times larger than the deficit in 2008, and deficits ever since that year have put those before 2009 to shame. Since 1973, the only years the federal government broke even were 1999 and 2000.
[Photo by Brendan Hoffman/Getty Images]
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