(MENAFN– The Rio Times) The US budget deficit rose to 6.4% of GDP in 2024, up from 6.3% in 2023. This increase happened despite more tax revenue, as debt service costs rose.
The Treasury Department released this data before the election, where Democratic VP Kamala Harris faces former Republican President Donald Trump.
The deficit reached $1.833 trillion by the end of the fiscal year on September 30, marking an 8.0% increase and the third-largest deficit in US history.
Only the deficits of 2020 and 2021 were larger due to pandemic-related spending. The deficit decreased in 2022 but began rising again in 2023.
High interest payments on debt drove the 2024 deficit growth, with Treasury Secretary Janet Yellen emphasizing long-term economic growth through investments in infrastructure, manufacturing, and clean energy.
A White House official criticized Congressional Republicans for tax cuts that reduced revenue and increased debt. Meanwhile, government revenue rose by 11.0% to $4.919 trillion due to improved household finances from higher employment and wages. In contrast, spending grew by 10% to $6.752 trillion, mainly due to debt servicing costs.
The expanding deficit highlights the ongoing struggle to balance economic growth with fiscal responsibility, likely shaping economic policy debates as the election nears.
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