(StraightNews.org) – The US government has borrowed around $1.2 trillion in the eight months prior to May, according to a Congressional Budget Office (CBO) report. The bipartisan institution said this figure represents a $38 billion increase on the same period last year. Additionally, it reports that government outlay was $4.5 trillion – an 8% rise – and net interest outlays on public debt were up 42%, or $185 billion. The CBO said that the increase is partly attributable to rising interest rates.
Social Security, Medicare, and Medicaid expenditure rose by $117 billion, with Medicare spending up 10%, which the CBO notes is attributable to Medicare Advantage plans. The Social Security bill was up $74 billion, or 8%, thanks to an increase in the number of beneficiaries and average payments.
The report also notes, however, that receipts also rose in the 2024 fiscal year’s first eight months, and the CBO explains the rise as resulting from the postponement of 2023 tax deadlines in federally declared disaster areas. Receipts totaled $3.3 trillion – up by $294 billion. Income and payroll taxes increased by $221 billion, with corporate tax receipts elevated by $76 billion. Other sources of income, including estate and gift taxes, customs duties, miscellaneous fees and fines, deceased by $3 billion combined, but excise taxes were up $6 billion.
In other key areas, federal spending on the Department of Defense was up 8% or $39 billion, and Veterans Affairs spending rose 14% or $27 billion.
In March, the Congressional Budget Office predicted that the federal government would be swimming in debt for decades, though it said the picture looks better than it previously estimated. It said labor growth – driven by immigration – and “faster capital accumulation over the next 30 years” would improve the outlook. By 2029, it expects debt to reach 107% of GDP, but experts note that the CBO tends to err on the side of caution, usually issues pessimistic predictions, and admits that its projections are uncertain.
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