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US budget deficit topped $ 1 trillion for the first time since 2012

Summary

US budget deficit topped $ 1 trillion for the first time since 2012 The U.S. budget deficit continued to widen in late 2019 as the government spent more than it raised in revenue despite a relatively robust economy. The gap […]

US budget deficit topped $ 1 trillion for the first time since 2012

The U.S. budget deficit continued to widen in late 2019 as the government spent more than it raised in revenue despite a relatively robust economy.

The gap between federal spending and revenue widened 12% to $ 357 billion in the first quarter of fiscal 2020, the Treasury Department said in its monthly budget report..

Deficit of $ 319 billion in the same period last year amid implementation of the Republican package of tax cuts and a bipartisan deal to increase spending.

US budget deficit topped a trillion dollars for the first time since 2012

The annual federal budget deficit in December 2019 exceeded $ 1 trillion for the third straight month. Calendar-year deficit totals $ 1.02 trillion for the first time since 2012, when lawmakers continued to take stimulus measures following the global financial crisis.

With historically low unemployment and strong growth, policymakers have more tools to tackle deficits. But budget hawks lost influence in Washington over the years, pushing the national economy further into the red.

Federal Reserve Chairman Jerome Powell warned in November that the deficit could tie the hands of policymakers in the event of a recession, adding that historically low interest rates would not change the need to cut it.. «Honestly, if we don’t, then our kids are going to spend their tax dollars on interest rather than what they really need.», – he said.

As a 2016 candidate, President Donald Trump pledged to close the deficit within eight years. But the non-partisan Congressional budget office predicts annual deficits to stay above $ 1 trillion for the next decade..