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The US federal government ran a deficit of $1.8 trillion (6.4% of GDP) in 2024. This is expected to increase to 6.7% of GDP in 2025.
Some notable developments in the federal government’s expenditure:
- Interest payments have grown to a hefty $890b per year, more than three times what they were a decade ago
- Tariff revenue more than doubled to $16b in April 2025, but this barely makes a dent in the overall deficit
- Most of the outlays are in social spending (i.e. welfare), military expenditure, and interest payments for previously incurred debt
Breaking down the expenditures explains why it is so difficult to “cut the deficit”: interest servicing and spending on the military and social security are structural costs. It is not a straightforward matter to reduce these outlays. Where the focus tends to be – DOGE touts cuts in areas like weather forecasting and food safety – are generally much smaller areas of expenditure.
*I am calculating net social spend as revenue from employment taxes and unemployment insurance [minus] outlays for income and social security.
Data from US Treasury; charts produced on Python.
CoolStatsBlog 
Is this data inflation adjusted?
Nope, it’s nominal dollars
Very nice plot. One issue that I wonder about… do you include the social security and medicare taxes (often called payroll taxes) as “income tax”? That has often been a confusing point… when some politicians in the US say some people pay no income tax, they omit the payroll taxes, which I think are never waived.
Then at least the OASDI portion of payroll taxes goes into a trust fund of US treasuries… something like $2.8 trillion, with something like $66 billion a year lately in interest income. Perhaps that income is going up a bit as interest rates rise, although probably many of the treasuries are fixed-interest. How do you handle that interest income?
Thanks!