In this Dec. 9, 2019, file photo mist rolls over the U.S. Capitol dome on Capitol Hill in Washington. The federal government recorded a budget deficit of $1.88 trillion for the first eight months of 2020, larger than even any annual shortfalls in U.S. history. The sea of red ink grew as government spending shot up to deal with the coronavirus pandemic and tax revenue shrank when millions lost their jobs. (AP Photo/Patrick Semansky, File)
By Martin Crutsinger
The federal government recorded a budget deficit of $1.88 trillion for the first eight months of this budget year, larger than even any annual shortfalls in U.S. history.
The sea of red ink grew as government spending shot up to deal with the coronavirus pandemic and tax revenue shrank when millions lost their jobs.
The deficit for the October-May period was more than double the $738.6 billion booked for the same period last year, according to Treasury Department numbers released Wednesday.
The Congressional Budget Office is forecasting that this year’s deficit will hit $3.7 trillion, which would be more than double the record $1.4 trillion deficit set in 2009. That previous record was set when the government was dealing with a financial crisis that had pushed the country into the deepest recession since the 1930s.
The country is now in another recession that began in February. This downturn has already seen much bigger job losses and is expected to be far worse than the 2007-2009 downturn.
The deficit for just May was $398.8 billion, a record for that month, and almost double the deficit for May 2019.
Government spending in May surged 30.2% to $572.7 billion. Lawmakers approved a $600 per week temporary increase in unemployment benefits, economic stimulus payments of up to $1,200 per individual, and a Paycheck Protection Program to provide forgivable loans to small businesses that kept workers on their payrolls.
The Paycheck Protection loans will not show up in the budget numbers until businesses begin applying and receiving approval for the bank loans to be forgiven.
Meanwhile, federal revenue fell by 25.1% last month to $173.8 billion as millions of people were losing jobs, which meant less being paid in individual taxes. In addition, the government has extended the deadline when people have to pay their 2019 taxes to July 15, which means a drop in revenue until that time.
For the October-May period, revenues were down 11.2% to $2.02 trillion compared to the same period a year ago, while spending was up 29.5% to $3.9 trillion.
Even before the measures taken to cushion the impact of the coronavirus, the government had been expected to run a deficit topping $1 trillion this year, reflecting lost revenue from President Donald Trump’s 2017 tax cuts and increased spending the White House and Democrats in Congress had agreed on for the military and domestic programs.
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A Michigan judge is putting sponges in the hands of shoplifters and ordering them to wash cars in a Walmart parking lot when spring weather arrives. Genesee County Judge Jeffrey Clothier hopes the unusual form of community service discourages people from stealing from Walmart. The judge also wants to reward shoppers with free car washes. Clothier says he began ordering “Walmart wash” sentences this week for shoplifting at the store in Grand Blanc Township. He believes 75 to 100 people eventually will be ordered to wash cars this spring. Clothier says he will be washing cars alongside them when the time comes.
The State Department had been in talks with Elon Musk’s Tesla company to buy armored electric vehicles, but the plans have been put on hold by the Trump administration after reports emerged about a potential $400 million purchase. A State Department spokesperson said the electric car company owned by Musk was the only one that expressed interest back in May 2024. The deal with Tesla was only in its planning phases but it was forecast to be the largest contract of the year. It shows how some of his wealth has come and was still expected to come from taxpayers.
At 100 years old, the Goodyear Blimp is an ageless star in the sky. The 246-foot-long airship will be in the background of the Daytona 500 — flying roughly 1,500 feet above Daytona International Speedway, actually — to celebrate its greatest anniversary tour. Even though remote camera technologies are improving regularly and changing the landscape of aerial footage, the blimp continues to carve out a niche. At Daytona, with the usual 40-car field racing around a 2½-mile superspeedway, views from the blimp aptly provide the scope of the event.
