---
title: "The budget deficit of the United States reached as high as $840 billion in the first four months of fiscal year 2025! Trump advocates for government \"downsizing\""
type: "News"
locale: "zh-HK"
url: "https://longbridge.com/zh-HK/news/228112983.md"
description: "The budget deficit for the first four months of the U.S. fiscal year 2025 reached $840 billion, setting a new record, primarily due to increased spending on healthcare, social security, and debt interest. Despite strong economic growth, the budget deficit continues to widen, posing a challenge for the Treasury Secretary to reduce the deficit-to-GDP ratio from 6.4% to 3%. The Congressional Budget Office predicts that the deficit for fiscal year 2025 will reach $1.865 trillion, rising to $2.7 trillion by 2035. The Trump administration plans to cut spending to address the deficit issue"
datetime: "2025-02-13T01:52:03.000Z"
locales:
  - [zh-CN](https://longbridge.com/zh-CN/news/228112983.md)
  - [en](https://longbridge.com/en/news/228112983.md)
  - [zh-HK](https://longbridge.com/zh-HK/news/228112983.md)
---

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# The budget deficit of the United States reached as high as $840 billion in the first four months of fiscal year 2025! Trump advocates for government "downsizing"

According to Zhitong Finance APP, **due to increased spending in areas such as healthcare, social security, veterans' benefits, and debt interest, the federal budget deficit in the United States reached a record $840 billion in the first four months of fiscal year 2025.** The U.S. Treasury Department stated in a statement on Wednesday that the budget deficit alone increased by $129 billion in January 2025. After adjusting for calendar differences, the cumulative deficit from October 2024 to January 2025 expanded by 25%.

Despite strong economic growth and continued job growth in the United States, the budget deficit continues to widen. This highlights the daunting task faced by U.S. Treasury Secretary Janet Yellen, who is attempting to reduce the deficit as a percentage of Gross Domestic Product (GDP) from 6.4% in 2024 to 3%.

Debt interest is a key factor contributing to the high federal budget deficit, as the Treasury refinances maturing debt with securities that have much higher interest rates. This is attributed to rising inflation in recent years and the Federal Reserve's interest rate hikes in 2022 and 2023. Data shows that from October of last year to January of this year, interest costs reached $392 billion.

The Congressional Budget Office (CBO) reported last month that the federal budget deficit for fiscal year 2025 is projected to reach $1.865 trillion, accounting for 6.2% of GDP. Additionally, the CBO forecasts that by 2035, the federal budget deficit will climb to $2.7 trillion, highlighting the challenges facing U.S. fiscal policy over the next decade.

The widening budget deficit may strengthen the resolve of Republican fiscal hawks to demand significant spending cuts from the Trump administration in exchange for their support of the major tax cuts that Trump is seeking this year. On Wednesday, the House Budget Committee released the text of a budget resolution draft, which seeks to cut mandatory spending such as the public healthcare program Medicaid and agricultural subsidies by $2 trillion.

**Trump administration "slimming down" Musk: Aiming to save the government $1 trillion**

The White House stated on Tuesday that Trump signed an executive order regarding the reduction of federal government staff. The order requires U.S. federal agencies to develop plans to lay the groundwork for large-scale layoffs of government employees.

The White House indicated that Trump's executive order will force U.S. federal agencies to collaborate with Musk's Department of Government Efficiency (DOGE) team to identify large-scale layoff plans and determine which agency departments may be completely eliminated. The new order also requires that for every four employees who leave a government agency, no more than one new employee can be hired.

In the executive order, Trump noted that in order to fulfill his responsibility to the American public, this order initiates a significant transformation of the U.S. federal bureaucracy, stating, "By eliminating waste, bloat, and rigidity, my administration will empower American families, workers, taxpayers, and our government system itself."

This move is the latest initiative by Trump and Musk to "slim down" the U.S. government. Musk has also pledged that he will save the government $1 trillion by working to identify fraud and waste within the government.

However, despite the aims of Trump's and Musk's government slimming reforms to reduce government spending, lower the deficit, and promote economic growth, they currently face legal challenges, questions of conflicts of interest, and public concerns about transparency Additionally, it is still unclear whether the Department of Efficiency has the authority to implement large-scale layoffs. A significant number of government employees belong to unions, which means that any large-scale layoffs must go through collective bargaining agreements with the unions

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