Fiscal Data Explains the National Deficit (2024)

A budget deficit occurs when the money going out exceeds the money coming in for a given period. On this page, we calculate the deficit by the government’s fiscal year.

In the last 50 years, the federal government budget has run a surplus 4 times, most recently in 2001.

To pay for government programs while operating under a deficit, the federal government borrows money by selling U.S. Treasury bonds, bills, and other securities. The national debt is the accumulation of this borrowing along with associated interest owed to investors who purchased these securities.

The chart below shows a breakdown of how the U.S. deficit compares to the corresponding revenue and spending.

The size of the national deficit or surplus is largely influenced by the health of the economy and spending and revenue policies set by Congress and the President. The health of the economy is often evaluated by the growth in the country’s gross domestic product (GDP), fluctuations in the nation’s employment rates, and the stability of prices. Simply put, when the country’s people and businesses are making less money, the amount collected by the government also decreases. Similarly, when the economy is doing well and people and businesses are earning more money, the government collects more. On the spending side, the increase or decrease of spending also impacts the budget, creating deficits or surpluses.

Legislation increasing spending on Social Security, health care, and defense that outpace revenue can increase the deficit. While revenue increased during the COVID-19 pandemic, from approximately $3.5 trillion in 2019 to $4 trillion in 2021, increased government spending related to widespread unemployment and health care caused spikes in the deficit. Visit USAspending.gov to learn more about the federal response to COVID-19.

The terms deficit and debt are frequently used when discussing the nation’s finances and are often confused with one another.

To pay for a deficit, the federal government borrows money by selling Treasury bonds, bills, and other securities. The national debt is the accumulation of this borrowing along with associated interest owed to the investors who purchased these securities. As the federal government experiences reoccurring deficits, which are common, the national debt grows. To learn more about the national debt, visit the National Debt Explainer.

The visualization below shows how deficits from previous years are added to the current year’s deficit to equal total debt. This illustration is simplified to show how debt and deficit are different. In reality, the U.S. government must pay interest on the national debt. This interest expense increases spending each year, increasing spending (and thus, deficits) as the debt grows.

Since 2001, the federal government’s budget has run a deficit each year. Starting in 2016, increases in spending on Social Security, health care, and interest on federal debt have outpaced the growth of federal revenue.

From FY 2019 to FY 2021, federal spending increased by about 50 percent in response to the COVID-19 pandemic.

America’s Fiscal Future
https://www.gao.gov/americas-fiscal-future

An Update to the Budget and Economic Outlook: 2021 to 2031
https://www.cbo.gov/publication/57339

Congressional Budget Office Topics – Budget
https://www.cbo.gov/topics/budget

Federal Deficits, Growing Debt, and the Economy in the Wake of COVID 19
https://crsreports.congress.gov/product/pdf/R/R46729

President’s Budget – Historical Tables
https://www.whitehouse.gov/omb/historical-tables/

FY 2022 Final Monthly Treasury Statement
https://fiscaldata.treasury.gov/static-data/published-reports/mts/MonthlyTreasuryStatement_202209.pdf