Federal spending skyrocketed in March when the government sent a third round of stimulus payments to Americans, widening the budget deficit to a record $ 1.7 billion in the first half of the fiscal year.
The budget gap, widened by the Covid-19 pandemic and related downturns that sent the economy in a lower direction in March 2020, is now more than double what it was for the same period a year ago, the department of treasury said Monday.
The deficit was $ 660 billion last month, 454% larger than in the same month a year ago. Revenue rose 13% to $ 268 billion, while spending rose 161% to $ 927 billion – the third-highest total on record, after June and April last year.
The increase in government spending has given the economy a bit of a cushion due to the devastation of the pandemic, but it has also raised federal debt to levels not seen as part of the war since the end of World War II. economy. Weaker tax revenues contributed to the budget deficit.
“While many of the loans over the past year have undoubtedly been justified, we are now becoming numb to the trillions of debt that are accumulating,” said Maya MacGuineas, president of the two-party committee for a responsible federal budget. ‘We have to start paying for what we spend. We need a plan to reduce debt. ”