For the primary 5 months of the 2025 fiscal 12 months, federal spending is coming in on the highest stage ever. That is true even once we alter for CPI inflation.
This largely displays Biden-era spending for the reason that present fiscal 12 months started throughout October 2024, through the Biden administration. In 2025 {dollars}, federal spending for the present fiscal 12 months to this point has totaled 3.039 trillion {dollars}. This makes 2025’s spending whole the best ever and it’s coming in above the covid-era whole (3.012 trillion) reached through the first 5 months of fiscal 12 months 2021.
In nominal phrases, the expansion is even bigger with federal spending to this point this 12 months coming in at about half a trillion greater than the earlier all-time excessive reached throughout 2021.
This knowledge solely covers the interval by the tip of February so it’s nonetheless too early to guess as to the total influence of any spending-cut initiatives popping out of the Trump administration. We do know that, regardless of many claims popping out of the administration, no vital influence can but be seen within the federal spending knowledge.
Income, nonetheless, has not been maintaining, so the excessive ranges of spending has additionally pushed ongoing development in whole federal deficits. For the primary 5 months of fiscal 12 months 2025, the federal deficit totals 1.146 trillion in 2025 {dollars}. That’s the second-highest deficit whole on report. Solely FY 2021’s whole of 1.259 trillion was larger.
This quantity is more likely to solely get larger. Regardless of a lot speak about spending cuts and tax cuts throughout final month’s debate over new spending laws, the Republican management’s personal numbers present that the Trump-approved price range beneath the Republicans will solely enhance every annual deficit additional in coming years.
For that reason, Kentucky Congressman Thomas Massie famous he would vote towards the Republicans’ proposed price range, and he identified that even the best-case situations assumed by Republican leaders would nonetheless produce a rising deficit and whole rising federal debt.
On February 25, Massie posted on X/Twitter that “The GOP budget extends the 5 yr. tax holiday we’ve been enjoying, but because it doesn’t cut spending much, it increases the deficit by over $300 billion/yr. compared to letting tax cuts expire. Over 10 years, this budget will add $20 trillion to US debt.”
The GOP price range extends the 5 yr. tax vacation we’ve been having fun with, however as a result of it doesn’t lower spending a lot, it will increase the deficit by over $300 billion/yr. in comparison with letting tax cuts expire. Over 10 years, this price range will add $20 trillion to US debt.pic.twitter.com/JZ2tDoTHI6
The rosy predictions for future deficits, as is common for presidency price range claims, assumes there might be no recession in coming months or years, since a recession would result in falling tax revenues and a ballooning of federal debt.
Massie was additionally dismissive of the Republican management’s claims that the GOP congress would cap discretionary spending after which spend on the price of inflation after that. “That has never happened,” Massie accurately famous.
Massie additionally defined that a lot of the Republican plan is constructed on spending and deficit cuts “over ten years.” For anybody who is definitely paying consideration, nonetheless, it’s clear that these ten-year plans for spending and deficit discount are little greater than smoke and mirrors. “ After all, no Congress can bind a future congress to any budgetary plan. Congress, at any given time simply spends as it wishes. Thus, Massie concludes that “Anything beyond the third year [in a ten-year budget plan] never happens” He’s proper.
As it’s, the federal authorities continues to hurtle towards a 40-trillion-dollar debt whole. Though the Trump administration touts its efforts to chop spending by way of the eliminination of some comparatively minor authorities departments, the actual fact stays that cuts to unpopular discretionary spending will not be sufficient. To make cuts to well-liked packages like protection spending, Social Safety, and Medicaid. For sure, that is unlikely to occur.
