This Aug. 24, 2020 file photo shows Treasury Secretary Stephen Mnuchin at the White House in Washington. The U.S. government’s deficit in the first three months of the budget year was a record-breaking $572.9 billion. The Treasury Department reported Wednesday, Jan. 13, 2021 that with three months gone in the budget year, the deficit was $216.3 billion higher than the same October-December period a year ago. (AP Photo/J. Scott Applewhite, File)
By Martin Crutsinger
The U.S. government's deficit in the first three months of the budget year was a record-breaking $572.9 billion, 60.7% higher than the same period a year ago, as spending to deal with the COVID-19 pandemic surged while revenue declined.
The Treasury Department reported Wednesday that three months into the budget year, the deficit was $216.3 billion higher than the same October-December period a year ago.
The deficit reflects an 18.3% jump in outlays to $1.38 trillion, a record for the period, while revenues fell 0.4% to $803.37 billion. The red ink results from the difference between revenue collections and outlays.
For just the month of December, the deficit totaled a record $143.6 billion.
The shortfall for the 2020 budget year, which ended Sept. 30, climbed to an all-time high of $3.1 trillion. Beginning in the spring, Congress passed trillion-dollar-plus spending measures to combat the harm being done to the economy from a pandemic-induced downturn.
The recession, which has seen millions of Americans lose their jobs, has also meant a drop in tax revenues at a time when the demand on government support programs such as unemployment benefits and food stamps has risen.
The report showed that outlays in December were a record $489.7 billion, while receipts were $346.1 billion.
The spending figure did not include the $900 billion relief package Congress finally passed after months of wrangling because it was not signed into law until the end of the month. President Donald Trump delayed signing the bill, which he called a “disgrace,” because it included only $600 in direct payments to individuals.
President-elect Joe Biden has endorsed boosting the direct payments by another $1,400. He has said that higher amount will be included in another round of relief payments he will ask Congress to approve once he takes office on Jan. 20.
In addition to direct payments, the December relief bill extended two special unemployment benefit programs aimed at cushioning the pandemic’s blow. The unemployment benefits have totaled $80 billion from October through December, up from $5 billion during the same period in the last budget year.
The Congressional Budget Office has forecast that this year's deficit will total $1.8 trillion and the deficit will remain above $1 trillion each year though 2030. The CBO forecast for this year was made before the December relief package was passed and also does not take into account any extra spending that Congress may pass after Biden takes office.
Updated on January 13, 2021, at 3:28 p.m. ET with the latest information.
The U.S. cannabis industry is on track to hit almost $25 billion in sales, according to New Frontier Data. Vivien Azer, managing director and senior research analyst at Cowen, and Russell Stanley, managing director and equity research at Beacon Securities Limited, join Cheddar News to give their predictions for the budding industry in 2022.
Rep. Earl Blumenauer (D-Ore. 3rd District), the co-chair of the Congressional Cannabis Caucus, joined Cheddar's "Cannabiz" to discuss the state of marijuana legalization on the federal level as more states continue to greenlight medical and adult use. He stated that there couldn't be a better time to revise the old policies on marijuana with more than 90 percent of Americans, including a majority of Republicans, on board. "This tidal wave of support continues. There were five states that approved in the last general election, and I think, rather than one single event, it is this momentum and the demonstration of broad public support that is making the difference," Blumenauer said.
Megan Horneman, Director of Portfolio Strategy at Verdence Capital Advisors, joins Cheddar News' Closing Bell, where she says there is some profit-taking ahead of the upcoming Fed meeting, and elaborates on some of the topics investors will be watching for more closely this week.
Rachel Bachman, senior sports reporter at the Wall Street Journal, joins Cheddar News' Closing Bell, where she explains how U.S. athletes have been inserted into the middle of a political debate after the country declared a diplomatic boycott of the upcoming Olympic Games in Beijing.
Lance Ippolito, Head Trader at the Future Of Wealth, joins Cheddar News' Closing Bell where he discusses the factors that have contributed to the recent slide of major cryptocurrencies like Bitcoin and Ether.
President Biden spoke with Russian President Vladimir Putin for the fourth time this year. Biden and Putin spoke for two hours about the massing of Russian troops and materials near the Russian border with Ukraine. Various outlets have reported that the U.S. has intelligence that Russia could be planning an invasion of Ukraine in the next few months. Both countries said the call was productive, but the situation remains tense.
Hagar Chemali, foreign policy expert and host of "Oh My World!" on YouTube, joins Cheddar Politics to discuss.
A recent Wall Street Journal poll indicated that Hispanic voters are up for grabs for the upcoming midterm elections, with 41 percent of respondents saying they would vote for Democrats and 44 percent for Republicans. Bryanta "Bre" Maxwell, a Democratic Strategist, former political director for Jaime Harrison's senate campaign, and principal and CEO of Indigo Consulting, LLC, joined Cheddar to break down the numbers and to dive into what this specific electorate is looking for as the balance of power in Congress hangs in the balance in 2022.
