US Budget Deficit Hits $1.8 Trillion Amid Increased Spending And Rising Interest Rates

The United States has reported a staggering budget deficit of $1.8 trillion for the past year, a significant increase from 2023's levels. This growing deficit has raised concerns among voters as the nation heads into the presidential election in November. The Treasury Department noted that the overall deficit expanded by $138 billion for the year ending September 30, primarily due to increased spending, which includes the rising costs associated with interest on the public debt.

This year's deficit marks the third-highest in US history, trailing only behind 2021 and 2020. In 2020, the deficit reached an unprecedented $3.1 trillion as the government increased spending to mitigate the economic impacts of the Covid-19 pandemic. As reported, there was a nearly 30% rise in spending on public debt interest in the latest fiscal year, surpassing $1 trillion, largely attributed to higher interest rates.

Amid these financial challenges, the Treasury pointed out that the widening deficit was also influenced by a reversal of over $330 billion in costs from the previous year, following the Supreme Court's decision to strike down President Joe Biden's student loan forgiveness plan. With increased spending on Social Security and defense, the financial landscape is under scrutiny, and the implications are significant as the nation navigates its fiscal future.