August budget deficit hits $200B as 2020 estimates approach levels not seen since WWII
The fiscal year-to-date deficit is about $3T
The U.S. budget deficit in August reached $200 billion as the country continues to battle the coronavirus pandemic, and experts warn it could hit levels not seen since World War II by the end of the year.
According to the Treasury Department’s monthly report, the additional $200 billion in August brings the cumulative U.S. fiscal year-to-date deficit to about $3 trillion.
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The Congressional Budget Office has estimated that the federal deficit could hit $3.3 trillion this year, which would be the highest level since 1945.
The forecast represents 16% of gross domestic product and the largest deficit recorded since World War II.
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Much of the recorded outlays have been attributed to an increase in government spending related to legislation designed to provide economic relief during the pandemic, which has included loans to small businesses and direct payments to American households.
Meanwhile, the White House is clashing with Democratic leadership over the cost of a potential additional stimulus package. White House chief of staff Mark Meadows said last week that the president was prepared to sign a $1.3 trillion bill, but House Speaker Nancy Pelosi has said she wanted something closer to $2.2 trillion.