Through two months, the fiscal year’s cumulative deficit was $244 billion above last year’s level. However, October 1, 2023, fell on a weekend, thereby causing certain federal payments to be shifted into the previous fiscal year (FY23) and artificially reducing last year’s deficit. Conversely, the cumulative deficit through the first two months of FY25 was boosted by certain payments being shifted into November because December 1 fell on a weekend. Without those effects, the deficit for FY25 through the end of November would be $543 billion, $90 billion more than the corresponding total for last year.

For the first two months of FY25, total outlays were $1.3 trillion, $194 billion higher than the same period in the previous year. Adjusting for the aforementioned shifts, spending was $41 billion above the same period last year. That increase was driven mainly by three categories: spending on national defense ($22 billion); Social Security spending was up by $16 billion, mainly stemming from cost-of-living adjustments; the Environmental Protection Agency spent $16 billion on grants related to clean energy. Another category that is increasing noticeably is net interest ($12 billion). Partially offsetting those increases was a $66 billion decrease in outlays by the Federal Deposit Insurance Corporation related to bank failure resolutions last year and the continued liquidation of the failed banks’ assets (which are recorded as a reduction in outlays).