By Mike Maharre
After running the third largest budget deficit in history in FY 2024, the Biden administration closed the financial 2025 in a similar way.
Federal government participated $ 257.45 According to the latest statement of the Treasury Department, to start the new financial year, the fall in revenue and lack of billion budget for spending.
This was an increase of 287 percent due to the deficiency of October 2023.
Federal receipts came in $ 326.77 billion. It was about 19 percent less than in October 2023. Last year, a one -time income of payment due to a wildfire was promoted for the revenue of October 2023.
As has been the case for months, the big problem is at the expense of the book.
Blowed through biden administration $ 584.22 billion Last month. This was an increase of 24 percent year after year. The outla for social security, medicare and national defense increased.
You may remember that President Biden promised that [pretend] Expenditure cut will save “hundreds of billions” with a loan deal (aka) [misnamed] Fiscal Responsibility Act).
This never happened.
The federal government keeps searching for new reasons to spend money, whether it is for natural disasters at home or war abroad. The Biden administration spent $ 6.75 trillion in FY 2024, increased by 10 percent as 2023.
The federal government spent $ 82 billion at interest expenses last month. This was a slight 8 percent decline, the first annual fall in interest expenses since August 2023. The Treasury Department said the fall was inspired by a decrease of $ 12 billion in payment for inflation-protected securities for low CPIs.
Pure interest expenses arrived at $ 80 billion. It was an increase of $ 4 billion in October 2023.
Uncle Sam paid $ 1.13 trillion In interest expenses in FY 2023. This was the first time interest expenditure has ever received $ 1 trillion.
Financial payment increased by 28.6 percent at the fiscal 2023 level.
Do not let the interest expenses fall short last month. The normal tendency remains upwards. Even with a recent recent Federal Reserve Rate cut, Treasury’s yield is pushing upwards as a demand for American debt dysfunctions. Since Trump’s election victory, the yield on a 10 -year Treasury is 15 basis points.
Most loans were currently funded at very low rates on books before the Federal Reserve started its hiking cycle. Every month, some of that super-lo-berelding paper mature and is replaced by a bonds with a lot of rates.
Influence of debt
We see these big deficit months -door, but most people do not kill their eyes. It seems that after the month you spend more than the month you spend more than it is not really a problem.
But whoever says that the “loss does not matter” has gone away.
As the bipartisan policy center states, the growing national debt and the growing fiscal irresponsible weakens the dollar.
“Faith in American credit may be less than a rapidly deteriorating fiscal state, a growing concern with federal debt to increase to a large extent in the coming years.”
This can lead to less economic development, high unemployment and low investment money.
Lack of trust in American fiscal state may also reduce the demand for US debt. This will force the interest rates on the American treasury to attract investors, increase the interest payment problem.
The national debt continues to spirals upwards from a dizzy speed. This will officially be $ 36 trillion top within days. According to the national debt clock, it represents 122.85 percent of GDP. Studies have shown a loan-GDP ratio of more than 90 percent retard economic development about 30 percent.
There is a possibility of debt that he will be one of the biggest problems before President Trump as he takes the reins of power. Along with controlling the chambers of both the Republican Congress and the White House, there is an opportunity to deal with the problem of expenditure, but does GOP have political will which are making adequate cuts.