The deficit jumped to a record$ 1.7 trillion in the first half of the fiscal year as a third round of stimulus checks included in President Biden's Relief Package sent federal spending skyrocketing.
The deficit for the first half of the year, from October through March, was up from$ 743.5 billion in the year-ago period, the Treasury Department said Monday.
YELLEN SAYS HIGHER TAXES NEEDED IN LONG TERM TO FINANCE US SPENDING.
In March, the gap between what it collected and what it spent was$ 660 billion, nearly four times what it was one year ago. The revenue increased to$ 268 billion last month, while the spending increased to$ 927 billion by 161%, the third-highest total in the current year after June and April of last year, figures show from Treasury data.
The figure comes on the heels of the$ 1.9 trillion stimulus package passed by Congress in March, which reduced unemployment benefits by$ 300 a month and extended the child tax credit temporarily. The stimulus payments in March totaled$ 339 billion; Biden and the congressional Democrats are currently working to pass another major economic spending proposal that could cost upwards of$ 2 trillion and would make huge investments in the nation's roads and bridges, as well as transit systems, schools and hospitals.
GET FOX BUSINESS ON THE GO BY CLICKING HERE The eight-year proposal would be made up by abolishing the corporate tax rate from 28% to 21%, reversing part of Trump's 2018 tax cuts as well as raising the global minimum tax on U.S. corporations from 13% and ending tax subsidiaries for fossil fuel companies.
The fiscal deficit for 2020, which was ended on Sept. 30, totaled a record$ 3.1 trillion.
The Congressional Budget Office estimated in February that this year's shortfall will reach$ 2.3 trillion, but that does not factor into the$ 1.9 trillion American Rescue Plan or the multitrillion-dollar Build Back Better infrastructure proposal under consideration.
CLICK HERE TO READ MORE FOX BUSINESS HOLDER INFORMATION ON FOX BUSINESS. Economists have suggested that while the nation's budget shortfall is a long-term concern, now is not the time to focus on reducing the balance sheet.
The US federal budget is on an unsustainable path, aired Federal Reserve Chairman Jerome Powell said in an interview with CBS's 60 Minutes podcast that was broadcast Sunday.
And this means that the debt is growing faster than the economy and that's kind of unsustainable in the long run.
That does n't mean debt is at an unsustainable level. It's not! We can also service the debt we have.