U.S. has record Oct. $284.1B deficit

The U.S. is starting the 2021 budget year the way the old year ended, with soaring deficits.

The Treasury Department reported Thursday that the federal government ran up a record October deficit of $284.1 billion, nearly double the red ink of the same month a year ago, as revenues declined while spending to deal with the impact of the coronavirus soared.

The October deficit was almost double the $134.5 billion deficit logged in October 2019. It smashed the previous October record of a $176 billion deficit set in 2009, when the government was spending heavily to lift the country out of a deep recession caused by the 2008 financial crisis.

The deficit for the 2020 budget year, which ended Sept. 30, totaled a record $3.1 trillion, breaking the old mark for an annual deficit of $1.4 trillion set in 2009.

The Congressional Budget Office is projecting that this year’s deficit will remain above the $1 trillion level, coming in at $1.8 trillion, the second largest annual deficit on record but an improvement over the $3.1 trillion set in 2020.

For October, spending totaled $521.8 billion, up 37.3% from a year ago and a record for the month. Big increases were seen in various government agencies.

Revenues fell by 3.2% to $237.7 billion, reflecting in part a drop in collections for Social Security taxes related to President Donald Trump’s executive order deferring payment of the taxes in an effort to give the economy a boost after Congress failed to approve another round of coronavirus support.