The federal budget deficit grew to $779 billion in fiscal 2018, nearly 17 percent higher than last year, according to the Treasury Department.
The deficit is now on pace to top $1 trillion next year, and is the largest since 2012, when the economy was still recovering from the last recession. Administration officials attributed the deficit increase to greater federal spending, including a big boost for the Defense Department signed into law by President Trump last month.
“President Trump prioritized making a significant investment in America’s military after years of reductions in military spending undermined our preparedness and national security,” Treasury Secretary Steven Mnuchin said. “Going forward, the president’s economic policies that have stimulated strong economic growth, combined with proposals to cut wasteful spending, will lead America toward a sustainable financial path.”
Three weeks ahead of the midterm elections, Democrats seized on the mounting deficit as evidence that the $1.5 trillion in tax cuts enacted by Republicans last year are not resulting in higher federal revenues or benefitting anyone other than the wealthy and large corporations. Democrats also pointed to recent comments by Senate Majority Leader Mitch McConnell (R-KY) that the nation’s growing debt is being driven by entitlement programs like Medicare, Social Security and Medicaid.
“We need to make sure the public knows exactly what’s up,” Sen. Chris Van Hollen (D-MD) told reporters this week. “Mitch McConnell gave the game up in his comments, and we just have to make sure the country knows…A vote for Republican candidates in this election is a vote to cut Social Security, Medicare and Medicaid.”
Concern over government spending has apparently reached the White House, with President Trump telling members of his Cabinet this week that they should plan to cut 5 percent from their agencies’ budgets. Of course, Congress would have to approve the president’s budget cuts.