November 10, 2021–For the fiscal year that ended September 30, the U.S. government ran a $2.8 trillion budget deficit, the Congressional Budget Office reported on Monday.
The figure was $360 billion less than the deficit in 2020 but three times the deficit from 2019. As a share of the GDP, the 2021 deficit was 12.4 percent the size of the economy. That’s down from 15 percent at the peak of the pandemic in FY2020 but up from 3.2 percent in 2016.
Federal spending increased above normal levels in 2020 and 2021 in response to the pandemic. They included the Coronavirus Aid, Relief, and Economic Security (CARES) Act, the Paycheck Protection Program and Health Care Enhancement Act, the Consolidated Appropriations Act, 2021 (CAA), and the American Rescue Plan Act of 2021 (ARPA).
Meanwhile, the federal debt was 99.7 percent of GDP in 2021, according to the CBO analysis. However, the ratio peaked in the second quarter to 125 percent of U.S. GDP, according to the Federal Reserve Bank of St. Louis. The latest figure from the U.S. Treasury puts the debt at $28.9 trillion.
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