Trump's Debt Diet is Working
From The Daily Signal
Hi friends,
Here’s a bit of a summary. The link to the full article is in Sources.
Even amid years of fiscal challenges, there are real signs of progress in Washington’s numbers, and that’s worth celebrating. Recent Treasury data shows that the federal budget deficit has actually shrunk compared to recent years, a noteworthy shift after decade-plus trends of escalating shortfalls. According to reporting from The Daily Signal, early fiscal 2026 figures indicate the deficit is running about 15% lower compared with the same period last year, driven by a combination of higher revenues and more disciplined spending.
Wage growth has outpaced inflation, translating into a bump in individual taxes that helps decrease the debt. At the same time, tariffs and customs duties brought in stronger collections, greatly increasing federal revenues without raising tax rates. And while most headlines in recent years have focused on ballooning deficits and debt levels, this shift — even if not large — shows that recent policy actions are moving the needle in a positive direction.
On the spending side, federal outlays have been more restrained, with several departments reporting reduced budgets. That belt-tightening, paired with the revenue gains, is leading to a smaller annual deficit, which means less borrowing is required to keep the government running. America isn’t yet in the black - not even close, and the national debt remains historically high — a long-term issue that will forever require common sense and political integrity. For now there’s improvement, and that’s worth noting.
What makes this moment particularly encouraging is that it’s not just a one-off blip in the data — it comes alongside broader economic trends that suggest momentum building in the right direction. When wages grow faster than inflation and federal revenues increase without new broad-based tax hikes, it’s a sign the economy is generating the resources needed to support strong government operations without excessive borrowing. That’s a fact that gives everyday Americans reason to feel optimistic.
So while there’s still more work ahead to achieve actual debt management, these early results show that policy choices matter and that when incentives for growth and decreasing wasteful spending, fiscal improvement happens.
Source:
https://www.dailysignal.com/2026/01/21/federal-budget-deficit-shrinks-under-president-trump/
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