“President Donald Trump returned to the White House with a promise to slash spending by trillions of dollars and balance the federal budget.
But, as the first fiscal year of his second term came to a close, progress had not been made on either of those goals.
Despite the high-profile efforts of Trump’s Department of Government Efficiency (DOGE), the 2025 federal fiscal year ended with the federal government having spent more money than it did in the previous fiscal year, the Congressional Budget Office (CBO) reported
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The CBO’s end-of-year report helpfully spells out which parts of the federal budget saw the biggest year-over-year spending increases. Overwhelmingly, and unsurprisingly, the biggest increases were for the so-called entitlement programs: Social Security, Medicare, and Medicaid. For those three programs, spending increased by a combined $245 billion.
Other big spending increases were recorded by the Pentagon ($38 billion) and the Department of Veterans Affairs ($41 billion), where the increase was driven by the rising cost of health care facilities. Interest payments on the national debt rose by $80 billion compared to the previous fiscal year’s totals.
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the CBO’s report serves to underline the same fiscal reality that plagued the DOGE project: Cutting silly government contracts and foreign aid might be a worthwhile effort, but that won’t make a dent in the budget deficit. Any serious effort at fiscal reform has to focus on the areas of the budget that are growing year over year—which, realistically, means looking at entitlement programs.
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There are plenty of reasons to be skeptical that anything will change in the next three years. For one, Trump’s track record after nearly five years as president does not suggest he cares very much about actually cutting spending. The coming years will also bring greater headwinds to any attempts at reducing the deficit. That’s due in part to the expected increases in entitlement spending, as well as the fiscal effects of the One Big Beautiful Bill Act, which extended and expanded the 2017 tax cuts in ways that will likely add to the deficit.”