Closing the 2016 books
The federal government has closed the books on the 2016 budget year, and the news isn’t good. The deficit rose sharply to $587.4 billion. That’s one-third higher than the $439.1 billion deficit in 2015.
Government receipts were up a modest 0.6 percent, but spending jumped a much sharper 4.5 percent. Weaker-than-expected economic growth led to lower tax revenues, while spending for such programs as Medicare and the money borrowed from the Social Security Trust Fund rose.
At the start of the Obama administration, there were four straight years of $1 trillion-plus deficits linked to efforts to combat the Great Recession. But since then, the deficit had been falling as the economy recovered. From a high of 9.8 percent of the total economy in 2009, the deficit dropped to 2.5 percent of GDP in 2015. The deficit rose to 3.2 percent of GDP in 2016.
The Congressional Budget Office is projecting the deficit will keep rising over the next decade, topping $1 trillion again by 2024, when it will represent 4 percent of GDP. Here is a look at budget components in 2015 and 2016: