Houston, We Have a Spending Problem

If you could reduce the latest deficit blowup to just one movie line, it would be from "Apollo 13."

"Houston, we have a spending problem."

Before I take you through today's doom and gloom news item, a quick reminder that every time I write about Washington's addiction to spending and debt — which codependent voters fully enable — I probably lose readers. But hard truths must be told, and if you hit the Back button instead of reading them, you won't be the first. Or the last.

Nevertheless, I persist after driving readers away for nearly a quarter of a century.

Once more unto the breach, dear friends, once more.

Oh, well — what can I say? I'm a slow learner.

I'm not quite so slow as our congresscritters in Washington, however. Even with tariffs generating yuge new revenues off of American consumer spending, Congress just gifted us with the biggest July deficit since the COVID lockdown/stimulus idiocy of 2021.

How big is big? THIS big, according to our very own Treasury:

July federal budget deficit: $291 billion. The only WORSE July occurred in 2021 during the pandemic. pic.twitter.com/CHLFbRjm4O

— Joel Griffith (@joelgriffith) August 12, 2025

If you had access to an unlimited number of million-dollar bills — just like Congress does! — you’d still need 291,000 of them just to cover the debt Washington ran up last month.

Most people couldn't scrape up $291,000 even without the extra six zeroes.

Compounding the problem, out of all of Washington's impossible-to-comprehend spending, in July, we spent an estimated $92 billion servicing the existing $37 trillion debt. That's a THREE and a SEVEN followed by TWELVE zeroes.

For a little more perspective, let's set the Wayback Machine for July 2021.

While it's true that our worst-ever July came with a slightly larger deficit of $302 billion, revenues that month were $262 billion. In July 2025, we nearly tied that previous July deficit record, but on revenues of $338 billion.

Washington collected nearly a third more in taxes, tariffs, and other revenues, yet still managed to add a near-record July deficit.

Repeat after me, and I'll write in all caps in case you want to shout it like I do: WASHINGTON DOES NOT HAVE A REVENUE PROBLEM.

Washington has a spending problem.

Maybe the month-to-month comparison is unfair. To that, I say, "Fine. Let's compare year-to-year."

The federal deficit in 2021 was $2.8 trillion, or 12.4% of gross domestic product. That's based on $4 trillion in revenues and $6.8 trillion in spending. The deficit this year is projected to be "just" $1.9 trillion. That's $7 trillion in spending and $5.2 trillion in revenues.

But then remember that 2021 was our second year of lockdowns and party-happy-good-times stimulus checks. In the year before COVID, the federal deficit was $984 billion, equal to 4.6% of GDP.

This year — no major war, no pandemic — the deficit will equal a whopping 6.2% of GDP. So even accounting for inflation and economic growth, the deficit in 2025 is a third higher than it was in 2019.

It's that bad with Republicans in charge. God only knows where we'll be when the Dems retake power.

Let me be totally fair and carve out a couple of caveats.

The first is that the bulk of the spending increases since July 2021 were legislated by the Democrat-controlled Congress in the first half of Joe Biden's single term, and signed into law by either the doddering fool or his autopen. Not that it makes any difference.

The second is that Democrats were smart enough to spread the gravy around into enough GOP-held states and districts to make their spending spree almost impossible to undo.

In other words, Republicans talk a good game about cutting spending, but when push came to shove with the One Big Beautiful Bill, talk was all they had. There's a lot to like in the OBBB Act, but fiscal discipline doesn't even make the list of things that almost made it into the bill.

So Trump's tariff revenues — I'll have a big update on the tariff situation in this week's Thursday essay — amount to putting a band-aid on a tumor.

Because we have a spending problem, and there's nobody in Washington with the will or the ability to do a damn thing about it.

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