The Treasury released the March Monthly Treasury Statement today. For fiscal year 2016 through March, the deficit was $461 billion compared to $439 billion for the same period in fiscal 2015 (the fiscal year ends in September).

In March, the Congressional Budget Office (CBO) released their new Updated Budget Projections: 2016 to 2026. The projected budget deficits were revised up recently.

US Federal Government Budget Surplus DeficitClick on graph for larger image.

This graph shows the actual (purple) budget deficit each year as a percent of GDP, and an estimate for the next ten years based on estimates from the CBO.

My guess is the actual deficit will be smaller in ficsal 2016 than the current CBO projection of 2.9% of GDP.

The decline in the deficit, as a percent of GDP, from almost 10% to 2.5% in 2015 was the fastest decline in the deficit since the demobilization following WWII (not shown on graph).

Note: In the year 2000 there were some projections that showed the entire debt could be paid off by now!   But then along came some significant tax cuts, the Iraq war, two recessions, and other policy mistakes.  Just a reminder that policy does matter.

The deficit is projected to remain stable for the next few years, before starting to slowly increase again.