CBO Reports $738 Billion Deficit Through First Four Months of FY 2021
For Immediate Release
The United States’ budget deficit for the first four months of fiscal year 2021 was $738 billion, according to the Congressional Budget Office (CBO). After the enactment of the most recent COVID relief legislation in December, we projected that the FY 2021 deficit would reach $2.3 trillion, but will update our estimates when CBO’s new budget baseline is released later this week.
Below is a statement from Maya MacGuineas, president of the Committee for a Responsible Federal Budget:
We borrowed a record $3.1 trillion last year and this year’s deficit may surpass that figure, depending on the outcome of the $1.9 trillion package under consideration.
Although we shouldn’t let concerns about the debt limit necessary borrowing, Congress ought to better target the current package based on what the economy and health care response really need. These numbers should serve as a reminder that once we get through this crisis, we have a pile of debt on the other side, and we shouldn’t make it needlessly worse.
Key highlights from today’s report:
- Medicaid outlays are 21 percent higher than the same period last year, largely due to the continuous coverage requirements and Medicaid matching funds increase in the Families First Act as part of the COVID response
- Spending on unemployment remained elevated and rose from $28 billion in December to $34 billion in January, due to the extension of emergency unemployment benefits provided by the December COVID relief bill
- All of the $25 billion in emergency rental assistance available for states under the Response & Relief Act was paid out in January
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