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In a recent year, or a typical year, what share of federal spending is borrowed deficit spending? Here’s a figure constructed from the ever-useful FRED website run by the Federal Reserve Bank of St. Louis. The numbers on the vertical axis can be read as percentages: that is, .2 is 20 percent, and so on. 
In 2024, 27% of all federal spending–a little more than a quarter–was borrowed as deficit spending. This is not an all-time low. In 2020 at the depth of the pandemic recession, 48% of all federal spending was borrowed. In 2009 at the depth of the Great Recession, 40% of all federal spending in that year was borrowed.But before those events, you have to go back in time. In 1943, at the depth of World War II, 70% of US government spending that year was borrowed. In 1932, in the Great Depression, 59% of government spending was borrowed.However, the 27% of federal spending that was borrowed in 2024 was a greater share than in any year from the end of World War II up to the Great Recession. In addition, the graph above suggests a downward trend: that is, the annual deficits as a share of spending during bad years are getting larger, while the deficits during good years are not bouncing back as much. Remember, 2024 was not a year of a national emergency like a pandemic or a Great Recession. It was a year with a growing economy and relatively low unemployment. It’s a time when reflexive political demands for tax cuts and/or spending increases deserve a gimlet eye and a dose of skepticism.More By This Author:OECD Survey Of Adult Skills: Where The US Stands
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