Rising Deficits: Unpacking November's Record Budget Shortfall

The U.S. reported a record $367 billion budget deficit for November, influenced by adjusted benefit payments. The deficit would have been $29 billion without these adjustments. The first two months of fiscal year 2025 saw a record $624 billion deficit, significantly increased from the previous year’s figures.

The U.S. government reported a $367 billion budget deficit for November, marking a 17% increase from the previous year, according to the Treasury Department. The deficit surge was primarily driven by calendar-adjusted benefit payments, which raised outlays significantly.

Without shifting December's Medicare and Social Security payments into November, the deficit would have been about $29 billion, or 9% lower than the previous year. Despite this adjustment, November's deficit set a record high for the month, with receipts climbing 10% to $302 billion, while outlays increased 14% to $669 billion.

For the first two months of fiscal year 2025, the deficit reached $624 billion, surpassing the COVID-19 era records. This period was affected by the end of tax payment deferrals related to natural disasters. Meanwhile, spending by the Department of Homeland Security saw a notable rise due to FEMA's hurricane response expenses.

(With inputs from agencies.)