Federal budget deficit climbs to $2 trillion as fiscal jitters multiply

The federal government ended its latest fiscal year, which closed September 30, with a shortfall near $2 trillion, according to the Congressional Budget Office. That is $218 billion, or 12%, more than the year before, and it adds to mounting worry about Washington's finances, since neither party in Congress has been willing to tackle the problem head-on, according to CNN.

Interest on the public debt was a major driver. Net payments passed $1 trillion for the first time, rising 11%, and only Social Security consumed more of the budget. Refunds also played a part: after the Supreme Court ruled that some of the Trump administration's global tariffs broke federal law, roughly $130 billion was paid back. Corporate tax receipts fell 16% to $382 billion, which the budget office linked to expanded deductions under last year's tax and spending law backed by President Donald Trump and congressional Republicans. Spending on Social Security, Medicare and Medicaid kept climbing, though most of that law's Medicaid reductions have yet to begin.

Debt reached a record $40 trillion in August, and bond market anxiety has pushed up borrowing costs, including mortgage rates.

Summarized by PolitiKool from CNN’s reporting. Read the full story at CNN →