Government Deficit On Pace To Be Second Largest In US History

(EVA HAMBACH/AFP via Getty Images)

Bradley Devlin General Assignment & Analysis Reporter
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The U.S. government’s deficit this budget year is on track to be the second-largest deficit recorded in the country’s history.

For the first nine months of the budget year, the U.S. government’s budget shortfall amounted to $2.24 trillion, The Associated Press (AP) reported. Government expenditures from October to June for this fiscal year amounted to $5.29 trillion thus far, whereas government receipts the government’s income via taxation and other mechanisms amounted to $3.06 trillion, the U.S. Treasury Department announced Tuesday.

The 2021 budget year’s deficit is 9.1% lower than it was in 2020, which set the record for the largest deficit in U.S. history at $3.1 trillion, The AP noted. Government receipts are up more than 35% compared to last year because tax deadlines were delayed, even though spending this year is up nearly 6%, thus far.

The Congressional Budget Office is projecting that at the end of this fiscal year, the budget will amount to about $3 trillion, according to The AP. Both the 2020 and 2021 budget deficits were largely increased due to the stimulus packages passed in the wake of the COVID-19 pandemic. The previous record before the COVID-19 pandemic was $1.4 trillion in 2009 following the 2008 financial crisis, The AP reported. (RELATED: Federal Government Racks Up Third-Largest Monthly Deficit Ever Recorded)

The U.S. is not the only world government borrowing in order to repair its economy from the crash triggered by COVID-19. The world’s debt amounted to 88% of gross domestic product (GDP) prior to the COVID-19 pandemic but has since increased to 105% of global GDP, the Institute of International Finance (IIF) stated, as previously reported