Deficit

Chicago Mayor Lori Lightfoot on Wednesday evening unveiled her plan to fill the city’s $1.2 billion budget deficit, the largest in its history.

The federal government incurred the biggest monthly budget deficit in history in June as spending on programs to combat the coronavirus recession exploded while millions of job losses cut into tax revenues.

The U.S. government’s budget deficit rose 92 percent in May from a year earlier to $399 billion, as revenues plummeted and spending surged on efforts to stem the new coronavirus pandemic and the fallout from lockdowns.

Over the past decade, the U.S. government spent nearly $100 billion on preparation for major health crises including pandemics, according to a 2018 paper on such funding -- though the coronavirus outbreak still had Washington and states across the country scrambling to muster supplies and respond when it hit. 

President Trump, thanks to high deficits in his first two full years in office followed by massive federal expenditures aimed at offsetting the economic effects of the coronavirus crisis, is on pace to add more to the national debt in his first term than did former President Barack Obama, whom Republicans often criticized for irresponsible spending. 

Congressional budget scorekeepers sounded the alarm Friday just as President Trump signed another multibillion-dollar coronavirus response bill, reporting in a new projection that the federal budget deficit will hit a stunning $3.7 trillion in fiscal 2020, and debt held by the public is projected to surpass GDP by year's end.

Following the passage of the $2.2 trillion CARES Act late last month, Goldman Sachs reportedly has forecast that the federal deficit will reach $3.6 trillion for 2020.

The U.S. government is poised to spend an unprecedented sum of money on its response to the coronavirus crisis, with a potential final price tag of nearly $5 trillion if lawmakers get the full extent of what they're seeking in as many as five separate bills.  

Many Americans gripe about the national debt, but in Washington, nothing much really changes.

A growing national debt means that for an ever-greater proportion of the budget will need to be spent making debt interest payments instead of paying for essential services.