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SUMMARY
Joe Brown analyzes recent U.S. federal budget deficits, highlighting persistent overspending despite promises of fiscal reform. He argues that rising tax revenues have not curbed deficits, emphasizing the need for individual financial protection against inflation and government debt.
MAIN POINTS
- Review of policy promises to reduce taxes and balance the budget, contrasted with actual deficit data from 2021.
- Comparison of the 2022 deficit to previous years, noting that even the best recent year matches the worst of the 2009 financial crisis.
- Explanation of why deficits temporarily decrease in certain months due to increased tax revenue, with 2026 starting slightly better than 2025 but worse than earlier years.
- Clarification that increasing tax revenue has not solved the deficit problem, as government spending continues to rise beyond tax collections.
- Illustration that even confiscating all U.S. billionaire wealth would only fund the government for about a year, underscoring overspending as the core issue.
- Emphasis on personal responsibility to protect against inflation and government fiscal mismanagement, as no policy changes are expected to reverse the trend.
DETAILED ANALYSIS
Over the past several years, the U.S. federal government has consistently run substantial budget deficits, despite policy initiatives aimed at reducing taxes and balancing the budget. In fiscal year 2021, the deficit reached $2.7 trillion, a figure driven by extraordinary spending. Although 2022 saw a reduction to $1.37 trillion, this was still comparable to the worst deficit year of the 2009 financial crisis, highlighting the magnitude of recent fiscal imbalances.
The trend continued with deficits of $1.69 trillion in 2023 and $1.8 trillion in 2024. Fiscal year 2025, despite a change in administration, ended with a deficit of $1.775 trillion, only marginally lower than the previous year. Temporary decreases in the cumulative deficit during certain months are attributed to spikes in tax revenue, but these do not alter the overall upward trajectory.
Total government spending has continued to rise, surpassing $7 trillion annually, with no significant efforts to curtail expenditures. Even as tax collections have increased—reaching $5.3 trillion in 2025—spending has outpaced revenue, negating any potential for deficit reduction. Historical comparisons reveal that returning to 2019 spending levels would have produced a surplus in 2025, and matching 2022 spending would have resulted in a much smaller deficit.
However, the persistent pattern is one of spending increases regardless of tax intake. The notion that higher taxation could solve the deficit is challenged by the fact that even confiscating all U.S. billionaire wealth would only temporarily fund government operations, with long-term negative economic consequences.
Ultimately, the analysis concludes that the deficit crisis is rooted in unchecked government spending rather than insufficient taxation. The burden of this fiscal policy is borne by citizens, either through direct taxation or the indirect effects of inflation. Individuals are urged to take proactive steps to mitigate their exposure to inflation and tax liabilities, as structural reforms are unlikely to reverse the current trajectory.
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- Bipartisan Policy Center, source of the deficit tracker chart.