US budget deficit reaches USD1.8 trillion in past fiscal year
Date
10/20/2024 2:14:02 AM
(MENAFN) The United States budget deficit reached USD1.8 trillion in the past fiscal year, surpassing 2023 levels due to significant government spending, including rising interest payments on the national debt. According to a report from the Treasury Department, the deficit expanded by USD138 billion, underscoring the ongoing financial challenges facing the country. The national debt has become a major issue for voters as the 2024 presidential election approaches, with concerns about the country’s fiscal management taking center stage.
This year’s deficit marks the third-largest in U.S. history, trailing only the record-setting deficits of 2020 and 2021, which were driven by pandemic-related spending. The Treasury Department attributed much of the recent increase in spending to a 30 percent jump in interest payments on public debt, a consequence of rising interest rates. As borrowing costs climb, the burden of servicing the national debt continues to grow, further straining the federal budget.
Despite these challenges, the U.S. government also saw a notable increase in revenue during the fiscal year. Much of this growth came from higher individual income and corporate tax collections, which helped offset some of the deficit’s expansion. This uptick in tax revenue suggests that, while spending surged, the underlying strength of the U.S. economy still contributed positively to government finances, according to the Treasury’s assessment.
In response to the latest budget figures, Treasury Secretary Janet Yellen emphasized that the U.S. economy remains resilient, even in the face of fiscal headwinds. She pointed out that the final deficit for 2024 was approximately USD76 billion lower than the government’s estimate from March. Nevertheless, the deficit-to-GDP ratio rose slightly to 6.4 percent from 6.2 percent in 2023, reflecting the ongoing fiscal pressures the country faces in managing its economic growth and debt obligations.
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