(MENAFN – The Rio Times) The US budget deficit increased to 6.4% of GDP in 2024, up from 6.3% in 2023. This rise occurred despite higher tax revenue, which couldn’t counteract rising debt costs.
The Treasury Department released these numbers just before the election, where Democrat Kamala Harris will face former Republican President Donald Trump.
By the end of the 2024 fiscal year, the deficit reached $1.833 trillion, an increase of 8.0% from the previous year, marking it as the third-largest deficit in US history.
Only the deficits of 2020 and 2021, driven by pandemic spending, were larger. After a drop in 2022, the deficit began to grow again in 2023.
Rising interest payments on the national debt fueled this growth in 2024. Treasury Secretary Janet Yellen emphasized the government’s commitment to long-term economic growth through investments in infrastructure, manufacturing, and clean energy.
A White House official criticized Congressional Republicans for tax cuts that decreased revenue and increased debt, while also pursuing further tax reductions.
Government revenue rose by 11.0% to $4.919 trillion from October 2023 to September 2024, thanks to higher employment and wages. However, spending also increased by 10% to $6.752 trillion, largely due to a significant rise in debt servicing.
The growing deficit underscores the challenges of achieving economic growth alongside fiscal responsibility, especially as the election approaches, likely spurring debates on spending and economic policy.
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