The Deficit Was $1.8 Trillion Over the Past Year

The federal budget deficit totaled $1.8 trillion over the past 12 months, up $70 billion from Fiscal Year (FY) 2023, or 4.2 percent. The 12-month rolling deficit from February 2023 to January 2024 is $190 billion higher than the prior 12-month period.  Removing the effects of student debt cancellation, which was ruled illegal, the rolling deficit was $2.1 trillion. As a share of the economy, the deficit was roughly 6.4 percent of Gross Domestic Product (GDP), or 7.6 percent excluding student debt effects.

Compared to the prior 12 months, total nominal spending is down 1.7 percent to $6.3 trillion (23.0 percent of GDP). Revenue is down 6.2 percent compared to the last 12 months, to $4.6 trillion (16.5 percent of GDP).

Rising spending and declining revenue have lead to a substantial deterioration in our fiscal situation.  Deficits are projected to reach $2.6 trillion by 2034 while debt will grow from 97 percent of GDP in FY 2023 – twice the 50-year historical average of 48 percent – to a record 106 percent of GDP by 2028 and 116 percent of GDP by 2034. Action will be needed to stem the unsustainable medium- and long-term trajectory of the debt. Policymakers should work together to get the economy and our fiscal health back on track.