The Congressional Budget Office has increased its estimate for the 2026 federal deficit by $200 billion, projecting a $2.1 trillion shortfall as interest costs consume a growing share of government spending.
By yourNEWS Media Newsroom
The federal government is now expected to run a $2.1 trillion deficit in 2026, $200 billion higher than the Congressional Budget Office projected earlier this year.
CBO had estimated the annual shortfall at $1.9 trillion in February, but its latest monthly review raised that figure to $2.1 trillion, according to The Hill.
The revision comes as the national debt approaches $40 trillion and federal spending continues to substantially exceed annual revenue.
The U.S. government collects approximately $4 trillion each year while spending roughly $6 trillion, leaving the difference to be financed through additional borrowing.
Debt-service costs have become an increasingly significant part of the federal budget.
According to Treasury fiscal data for fiscal year 2026 to date, interest on the national debt accounted for approximately 15% of federal spending.
Social Security remained the government’s largest spending category at 23%.
Medicare represented 14% of federal expenditures, while the broader Health category accounted for another 14%.
National Defense represented 13% of spending.
The CBO’s $200 billion upward revision pushes the projected annual deficit above $2 trillion and underscores the widening gap between federal revenues and expenditures as debt and interest costs continue to rise.
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