US budget deficit topped $1 trillion in 2019 for the first time in seven years
Certainly, it is understood that the budget deficit or public deficit describes the situation in which the expenses incurred by the State exceed non-financial income, in a given period, usually one year.
Likewise, when talking about a public deficit, reference is being made to the deficit of all public administrations in a country. For example, if we refer to the Spanish case, within the public deficit there would be a part originated by the State, another by the autonomous communities and another by the municipalities and provincial councils, the public deficit is the sum of all of them.
There is talk of a fiscal deficit in a closed economy in situations where the government does not have access to direct indebtedness with the public, inside or outside the country, and that its international reserves have been exhausted. Therefore, the only option left is to borrow from the central bank.
Once again after seven years
The U.S. budget deficit exceeded $ 1 trillion in 2019 for the first time in seven years
That’s right, the U.S. fiscal deficit has exceeded $ 1 trillion in 2019, the first time it has exceeded that level in a calendar year since 2012, according to Treasury Department figures released on Monday.
Certainly, the budget deficit reached $ 1.02 billion for the period from January to December, an increase of 17.1% compared to 2018, which in itself had seen a jump of 28.2% over the previous year. The increase in corporate tax revenue helped reduce the rate of increase in the spending gap.
For the fiscal year, which began in October, the deficit is already at $ 356.6 billion, an increase of 11.7% over the previous year. It is considered that if that pace continues, it would also lead to a fiscal deficit for 2019–20 of more than $ 1 billion.
For his part, President Donald Trump had promised that his stimulus policies, including the massive reduction of corporate taxes and aggressive deregulation, would help stop the red ink from Washington, however, it is clear that it has only increased. As the deficits increased, so did the national debt, which is now $ 23.2 billion.
Source: Jeff Cox | CNBC