The federal government recorded a budget deficit of $208.7 billion in March, an increase of more than $32 billion from a year ago as revenues slipped and expenditures climbed.
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The Treasury Department said Wednesday that the February deficit was 18.4 percent higher than a year ago, largely due to increased expenditures on benefits for the military, veterans and recipients of supplemental security income as well as higher Medicare payments because April expenses were paid in March.
For the first five months of this budget year, the deficit has totaled $599.7 billion. This is an increase of 13.8 percent from the same period a year ago.
After President Donald Trump signed into law tax cuts, the Congressional Budget Office estimates this year’s deficit will hit $804 billion, up almost $140 billion from last year. The deficit is projected to reach $981 billion in 2019. It would then exceed $1 trillion for the foreseeable future.
Rising federal debt loads stemming from the $1.5 trillion worth of tax cuts over the next decade could provide a brief boost to economic growth, but the costs of servicing the debt could also be a drag on growth in the long term and possibly make it harder for the government to respond to an economic downturn.
“Such high and rising debt would have serious negative consequences for the budget and the nation,” CBO Director Keith Hall said Monday. “In particular, the likelihood of a fiscal crisis in the United States would increase.”
