U.S. deficit said to be 26% higher

Interest costs, outlays blamed

The U.S. Treasury reported a deficit in November that was 26% higher than a year ago, driven by higher interest costs and other outlays.

The federal government reported a $314 billion deficit in November, which is a record for the month.

The deficit ballooned in March this year to $378 billion.

The last time the Treasury reported a deficit in the month of November even close to the deficit last month was the $248 billion deficit reported in November 2022.

The government’s yearto-date deficit for fiscal year 2024 was $381 billion, which is 13% higher than the same period a year ago.

Revenues rose by 9% from a year ago to $275 billion but outlays jumped by $88 billion and are nearly 18% higher than a year prior.

One of the biggest outlays was $122 billion for monthly Social Security payments.

One reason for these higher outlays is interest payments on the federal government’s debt.

Reuters reported on Tuesday that interest payments on the the U.S. government’s debt accounted for $25 billion of that increase.

Debt service costs have risen since last spring as the Federal Reserve has raised borrowing costs to rein in inflation, Reuters reported.

“I think that is one of the most important things we see here is how much the interest costs are going up, they are slightly larger than national defense spending in November and that’s partially the result of interest rates going up, which is driven by the Fed raising rates, but also, as the aggregate amount of national debt grows larger, that number will keep going up too,” University of Central Arkansas associate professor of economics Jeremy Horpedahl said.

“Now too, it seems like [the U.S. has maintained] a steady state of about a $2 trillion annual deficit, so the national debt increasing so much and rates being higher, I think we will continue to see that interest cost go up and creep in the rankings of programs.”

As of Dec. 8, the national debt was $34 trillion and of that amount, $7 trillion is money the government owes itself.