Washington D.C. — The $305 billion deficit for the first two months of Fiscal Year 2019 shows the United States is closing in on trillion dollar deficits if Congress takes no action to stop this trend.
“Treasury’s report shows yet again that rising deficits are the new normal. It is an unfortunate trend continuing in the new fiscal year,” Shai Akabas, director of economic policy at BPC, said.
Deficits are rising unabated, primarily due to sustained growth in entitlement spending and now decreasing revenues due to the Tax Cuts and Jobs Act of 2017. Rising deficits lead to rising debt and higher interest payments. Over the past two months alone, the federal government has spent $65 billion on interest payments on the debt.
“Our federal budget challenges are barely part of the conversation on Capitol Hill. That must change if we are to get our fiscal house in order,” Akabas said.
And yet as deficits continue to rise, congressional leaders are once again caught up in a near-term political battle that is unlikely to address the deficit and could even lead to a partial government shutdown.
“In the near term, shutting down the government should not be a go-to policy option. A government shutdown would waste millions of taxpayer dollars, and is unlikely to produce any benefit to the American people.”
Shai Akabas is available for comment.