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WASHINGTON (AP) – The US government's budget deficit increased by $ 169 billion to $ 1.07 trillion in the first eleven months of the current fiscal year as spending rose faster than tax collection.
The Treasury Department reported Thursday that the deficit just one month into the fiscal year was up 18.8% over the same period last year.
Budget experts predict a surplus for September, bringing the total deficit of 2019 to just under a trillion dollars. The Congressional Budget Office forecasts a deficit of $ 960 billion this year, compared to a deficit of $ 779 billion in 2018.
The CBO predicts that the annual deficit will reach $ 1 trillion in 2020 and will never fall below $ 1 trillion in the next decade.
The government has only recorded deficits exceeding one trillion dollars over another four-year period between 2009 and 2012, when spending rose to cope with a deep recession and the worse financial crisis since the 1930s.
The higher deficits currently reflect higher government spending, two budget agreements signed in 2018 and this year between the Trump administration and Congress, which added billions of dollars in additional spending to the military and national programs.
In addition, social security and health insurance payments are rising as millions of baby boomers retire. On the upside of spending is the impact of the $ 1.5 trillion tax cut that President Donald Trump forced to Congress in 2017, reducing tax rates for individuals and companies.
For this year, revenues increased 3.4%, but spending rose 7%, almost double the increase in revenue.
Individual tax receipts rose 2% in the first 11 months of this year compared to the same period in 2018, while corporate tax receipts decreased by 2%.
Bypassing this weak growth, tariffs increased by $ 28 billion or 73% over last year, reflecting Trump's higher tariffs to China and other countries in the world. the setting for his tough commercial battles.
On the expenditure side, the government has spent up to $ 379.1 billion in debt interest payments, an increase of $ 47 billion over the previous year. last, because of the growing size of the national debt.
Commenting on the new report, Michael Peterson, director of the Peterson Foundation, said, "In the absence of more accountable budgets, the deficit and interest costs will continue to grow rapidly, which will reduce the future of l & # 39; America. "
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