THE NATION’S BUDGET deficit swelled to a record $2.8 trillion in the first 10 months of the fiscal year, with the federal government on track to more than double the largest shortfall on record by the end of 2020.
The government added $63 billion to the deficit in July, the Treasury Department said Wednesday. The monthly deficit figure was the lowest since the start of the coronavirus pandemic, largely because of a dip in government spending and tax revenue collected last month. The government extended the tax filing deadline to July 15 because of the pandemic.
The U.S. is set to see a about a $3.7 trillion deficit in fiscal 2020, which ends Sept. 30, because of drastic government spending meant to buoy the economy during the coronavirus-induced recession. The amount of spending is comparable only to government expenditures during World War II. Last year, the total deficit was just under $1 trillion.
Federal spending soared this spring after Congress approved trillions of dollars in pandemic relief in the form of stimulus checks, enhanced unemployment benefits and emergency loans for businesses. That spending began to taper off last month – outlays in July were down about half of what they were in June – contributing to the fall in the deficit.
Negotiations over another stimulus measure have stalled but could resume. President Donald Trump on Saturday announced four executive actions aimed at stimulating the economy, including a plan to continue increased unemployment benefits.