US budget deficit nears $2 trillion
The gist
The US fiscal 2026 deficit rose 12% to $1.99 trillion, the highest since 2021.
Borrowing costs are climbing as interest and defense spending squeeze the budget.
How it unfolded
- 2025 (fiscal year)The deficit was $1.78 trillion, with net interest at $970 billion, Social Security spending around $1.6 trillion and Medicare slightly under $1 trillion.
- 2025Congress passed the One Big Beautiful Bill act tax cut package.
- 2026 (early year)The Supreme Court reversed a broad set of tariffs imposed by Donald Trump.