Budget Deficit

February's Budget Deficit Was the Largest in American History

The feds are $234 billion in the red. Looking for hope? Sen. Mike Enzi has some ideas.


Caro / Wareham/Newscom

The U.S. Treasury reports that the federal government ran a record-breaking budget deficit in February. Meanwhile, the incumbent president, who has presided over a sharp increase in the national debt, has released a budget proposal that projects $1 trillion annual deficits for the rest of his time in office.

I'm talking about 2019. And also 2012.

The Treasury announced Friday that the federal government spent $234 billion more than it brought in during February, breaking the record for the largest monthly budget deficit. Barack Obama's Treasury Department set the previous record in February 2012, with a deficit of $231 billion. At that time, President Obama had just delivered his latest budget proposal to Congress, which anticipated $1 trillion annual deficits for the rest of the decade—almost identical to the projections offered by Donald Trump in his 2019 budget proposal, delivered earlier this month.

The similarities only extend so far. That Obama budget was roundly criticized by Republicans in Congress, who railed against the president's "failure to control spending," as Rep. Cathy McMorris Rodgers (R-Wash.) put it at the time. Obama's record deficit helped organize Republican policymaking around plans to cap spending growth and balance the budget. Those plans never came to full fruition, but the deficit did fall as the Republican Congress slowed the growth in government spending and as a recovering economy boosted tax returns.

It is highly unlikely we will see a similar outcome this time.

Indeed, the current record-high deficit is largely the fault of the same Republicans who once attacked Obama for spending too much. According to an analysis from the nonpartisan Committee for a Responsible Federal Budget, about 60 percent of this year's expected deficit is the result of policies—mostly last year's huge increase in spending that shattered those Obama-era budget caps—put in place by current legislators and signed by the current president.

They can't blame a recession. They can't blame Obama. After years of solid if not mind-blowing growth, the budget deficit should be shrinking, not expanding.

Failing to fix the budget now will have consequences for years to come. Over the next 30 years, Social Security and Medicare are expected to run a combined $100 trillion deficit. Addressing that issue will require tough decisions that have only been made more difficult by officials who have essentially wasted a decade of relative good times, leaving America exactly where it was seven years ago—except now there seems to be less political will to do anything about it.

If you're looking for a glimmer of hope, it might be found in the budget plan recently released by Senate Budget Committee Chairman Mike Enzi (R–Wyo.). Enzi's budget is supposed to reduce the deficit by $538 billion over five years by cutting spending—and also, alas, by projecting probably unrealistic economic growth in the next half-decade. His proposal includes cuts to mandatory spending on programs like Medicare and Medicaid (though it would leave Social Security untouched), which make up more than 60 percent of the federal budget in a single year.

Whatever it's flaws, Enzi's proposal is a serious attempt to bring the deficit back under control, even though it would not balance the budget. It will get a hearing later this week, but it likely faces a difficult political road forward.

NEXT: $25 Million Later, 3 Pundits Kind-of-Sort-of Change Their Minds on Collusion

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  1. They can’t blame a recession.

    But one coming within the next year or two is all but inevitable, even if it’s only a self-fulfilling prophecy, so we’ll have a recession plus ridiculously high spending and dwindling tax revenue. At least that will put downward pressure on interest rates, so the debt can be serviced for only 8-10% of the federal budget.

    1. MAGA, baby. Worrying about deficits is for cucks! Now let’s build that wall to save some money!

      1. MAGA for the Red-Staters… MALGA for the Blue-staters! MALGA = Make America LESS Great Again!

        All of the red-state hyper-patriots just KNOW, somehow, that immigration Makes America LESS Great Again… Yet very, very, VERY few of them are Native Americans, and even the ancestors of “Native Americans” ultimately came from Africa!

        Well anyway, all anti-immigration thinking is just like the rich fat-cats in coastal California- Now that I have MY mega-mansion overlooking the Pacific, NO OTHERS may build more of them! (Now that me and mine have arrived here in the USA, shut down the rest, don’t allow them to come here). Pretty simple analogy, and it is TRUE…

      2. Cucks? I thought it was for cacks.

      3. I basically make about $6,000-$8,000 a month online. It’s enough to comfortably replace my old jobs income, especially considering I only work about 10-13 hours a week from home. I was amazed how easy it was after I tried it?

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  2. Unlike every other budget deficit since the dot-com bubble burst?

  3. Have to abolish social security. No old people won’t die in the streets. They will move back in with their kids and everyone will actually be happier and healthier. Social security is destroying our country.

    1. Intriguing. Are there any details to your plan?

      1. Just look at how most societies have had multi-generational households for most of human history.
        Even within the current-day USA, you can go to many immigrant households and find 3 generations.

        It’s not like we need instruction manuals on how to do it.

    2. I’m going to go out on a limb here and suggest that you do not have elderly parents.

      1. And that your relatively young and haven’t paid much into social security?

        1. No one paid anything in to Social Security. 6.2% of your paycheck, along with a match from your employer, went to the general fund. A bunch of that money got redistributed to older people who are relatively wealthier than you.

      2. Amen to this comment. Move back in with their kids. What a laugh. Wait till your fighting dad for the TV, trying to decide if you watch Matlock or the Walking dead.

        1. “trying to decide if you watch Matlock or the Walking dead.”

          What’s the difference?

          1. Matlock doesn’t drag the villains out as long

    3. the old people will need their kids to move out before they can move in with them. I know a couple of 50+ somethings living with their parents these days, its not just lazy millenials

  4. If only there were some way to tie Putin to the national debt.

    I can think of something – with all the money we owe, how can we find even *more* money to pay for defense against Russia?

    1. If only there were some way to tie Putin to the national debt.

      You might be on to something.

      “Russian bots discovered advocating increased federal spending to bankrupt the US.”

    2. He is purposely fucking with us and getting caught so American pols don’t come together and fix our problems and only argue over who peed on who.

    3. it won’t work since all the candidates are proposing even higher deficits. i think it is a lost cause now

  5. Everyone knows deficits only matter when a Democrat is POTUS.

    1. Why are you disrespectful of Reason’s property rights? They banned you. Why can’t you accept that they don’t want you here?

  6. The U.S. Treasury reports that the federal government ran a record-breaking budget deficit in February. Meanwhile, the incumbent president, who has presided over a sharp increase in the national debt, has released a budget proposal that projects $1 trillion annual deficits for the rest of his time in office.

    “Unsustainable” year after year after year.

    1. No kidding. Wake me up when there are actual consequences.

      1. oh, you’ll be awake all right — unable to sleep because coffee could be too expensive by the next morning

  7. Let me preface my comments by saying this is not at all surprising because no one gives a shit about deficits anymore because no politician dares touch the main source of the deficit: entitlement spending.

    Having said that when adjusted for GDP this is not the largest monthly deficit in US history; Obama’s deficit still holds that record.

    Actually, when taking percentage of GDP into account FDR’s wartime budgets probably still hold the record for monthly and annual deficits.

    1. Well when adjusted for the height of the average citizen, nothing beats the profligate munchkins of Oz

    2. Only reason we’re not Greece is that everyone wants to lend to Uncle Sam.

  8. Blaming any recent legislation for deficits is absurd when longstanding entitlement programs make up a large majority of spending.

    But please, supposedly-libertarian-site, go on citing sources that treat tax reductions as sources of deficits.

    1. Nothing else changed (except for increased defense spending)

      The economy has been improving since 2009. SS/Medicare receipts are up.

      1. Again Why are you disrespectful of Reason’s property rights? They banned you. Why can’t you accept that they don’t want you here?

  9. If you somehow put Muller int eh title those in power may care

  10. Yeah not surprising. Not even supposed libertarians seem to care about the deficit anymore.

    Witness that this article gets maybe 30 comments, but the next one over on Avenatti is at 126 and counting.

    People would rather focus on political celebrity scandal rather than, you know, not spending ourselves into oblivion.

  11. Cut every federal program by 90% for 10 years.

    That includes Social Security, Medicare, Medicaid, all the farm subsidies, the military and black budgets, foreign aid, NASA, the USGS, research grants, student financial aid, transportation infrastructure, Congressional health care, pensions, EVERYTHING.

    That’d be the only way to save us. Cutting 80% is probably not even enough (Pareto principle: 20% of the budget is accomplishing 80% of the results–the remaining 80% of the budget is largely wasted).

    1. it’s much easier than that — cut them all by 10%, then freeze at those levels for 5 or 6 years. Inflation takes care of the rest. you only have to cut spending back to the levels of a few years ago to balance the budget.

      1. It’s easier than that.

        Freeze spending at the current level, no actual cuts necessary, and hold level for 5 years. The rest proceeds as you explained.

  12. So much for the idea that divided gov’t is a fiscal restraint. Then again, you could look at many states of the USA in recent time & note the same.

  13. libertarian month….

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