The
U.S. federal budget deficit rose in fiscal 2018 to the highest level in six
years as spending climbed, the Trump administration said Monday.
The
deficit jumped to $779 billion, $113 billion or 17 percent higher than the
previous fiscal period, according to a statement from Treasury Secretary Steven
Mnuchin and Office of Management and Budget Director Mick Mulvaney. It was
larger than any year since 2012, when it topped $1 trillion. The budget
shortfall rose to 3.9 percent of U.S. gross
domestic product.
The
deficit increased by $70 billion less than anticipated in a report published in
July, according to the two officials.
Federal
revenue rose only slightly, by $14 billion after Republicans chopped tax rates
for corporations and most individuals. Outlays climbed by $127 billion, or 3.2
percent. A spike in defense spending, as well as increases for Medicaid, Social
Security and disaster relief, contributed to the increase.show chapters
The
Trump administration and congressional Republicans have pledged their
commitment to fiscal discipline, despite the fact that they passed a tax law
projected to dramatically expand budget deficits last year and then authorized
a boost in spending. In a statement, Mulvaney claimed that "America's
booming economy will create increased government revenues," a point the
GOP has repeatedly argued in favor of its tax plan.
"But
this fiscal picture is a blunt warning to Congress of the dire consequences of
irresponsible and unnecessary spending," he added. "Going forward,
President Trump and this Administration will continue to work with Congress to
make the difficult choices needed to bring fiscal restraint, which, when
matched with increasing revenue, will reduce our deficit."
Several
independent analyses have estimated the GOP tax plan will cause budget deficits
to grow dramatically over time, even after economic growth is taken into
account.
The
Trump administration has proposed dramatic cuts to spending in several
government agencies to reduce deficits. Even many Republicans have rejected the
severity of proposed budget cuts.
The
Treasury noted that receipts related to "excise, customs and other"
jumped to $35 billion in September 2018, a 35 percent increase over the
prior-year period. It is unclear how much of that revenue relates to Trump's
tariffs on imports from major trading partners.
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