Site last updated: Sunday, November 24, 2024

Log In

Reset Password
MENU
Butler County's great daily newspaper

U.S. budget deficit up significantly

WASHINGTON — The federal government recorded a budget deficit of $215.2 billion in February, up significantly from a year ago as the impact of the GOP tax cuts passed in December begin to surface.

The Treasury Department said Monday that the February deficit was 12.1 percent higher than a year ago, reflecting in part a drop of $5 billion in individual withholding taxes paid last month compared to a year ago. In February, employers started using tax tables that withheld less from paychecks based on the new law.

For the first five months of this budget year, the deficit totals $391 billion, an increase of 11.5 percent from the same period a year ago. President Donald Trump’s new budget projects this year’s deficit will hit $873 billion, up a sharp 31.3 percent from last year’s imbalance of $665.8 billion.

Over the next decade, Trump’s budget projects deficits will total $7.1 trillion. That is more than double the $3.2 trillion in deficits over the coming decade that Trump had envisioned in the budget he sent Congress last year. The deficit picture has darkened in part because of the $1.5 trillion in tax cuts Trump pushed through Congress in December.

The administration argues that the tax cuts will pay for themselves over time by boosting growth. But critics contend that this is an overly optimistic view. They argue that deficits will be much worse than Trump is currently forecasting because his budget is using overly optimistic economic forecasts and does not take into account increased government spending which was approved in a January budget deal.

Many private forecasters believe annual deficits will top $1 trillion beginning next year and remain at that level in coming years.

More in National News

Subscribe to our Daily Newsletter

* indicates required
TODAY'S PHOTOS