During the first half of fiscal year 2025, the US government had the second-largest semi-annual budget deficit in history.
The March budget deficit of $160.53 billion brought the total deficit for the first half of the fiscal year to $1.31 trillion, according to the latest statement from the Treasury Department. The only larger half-year budget deficit was $1.7 trillion in the first half of fiscal year 2021, when the economy was paralyzed and the government prioritized delivering funds to address the pandemic.
During the first six months of fiscal year 2025, the US Treasury collected $2.26 trillion. This figure was slightly higher than the $2.19 trillion collected during the first half of fiscal year 2024.
However, according to a Treasury Department official, the 2024 revenue figure was inflated due to deferred tax payments from 2023 related to natural disasters.
The real problem lies on the spending side.
The Trump administration squandered another $528.17 billion last month. This brought cumulative spending for the fiscal year to $3.57 trillion. This represents a 9.8% increase in spending over the same period in 2024.
Spending increased by $139 billion during the first quarter of 2025 compared to the same period last year. Borrowing during that period was $41 billion higher.
A Treasury Department official told the Associated Press that the increase in spending was due to a combination of cost-of-living increases in Social Security, higher Medicaid and Medicare costs, and a jump in Pentagon spending.
You may recall that President Biden promised that the [purported] spending cuts would save “hundreds of billions” with the debt ceiling deal (also known as the [misnamed] Fiscal Responsibility Act).