First the good news: Elon Musk's DOGE is going through government spending with a fine-toothed comb, slashing a million here, a billion there.

The bad news: at the rate it is going, DOGE will need a few hundred years to make a tangible impact, because as the Treasury just reported, in February the US government spent a staggering $603 billion, a 6% increase from the $567 billion a year ago...

... while it collected just $296 billion in tax revenues...

... which resulted in a $307 billion budget deficit for the month, which means that all tax revenues collected by the US government in February were less than the deficit! Said otherwise, the US spent more than twice what it collected in February.

Which in turn, means this February's deficit was just shy of the highest on record, and only the post-covid shock of 2021 was greater...

... and pushed the cumulative total for 2025 to $1.147 trillion, covering 38% of all US spending in fiscal 2025.

This is a problem because as shown in the next chart, the cumulative budget deficit for the first 5 months of fiscal 2025 is the highest on record, surpassing even the fiscal shock from the depths of the post-covid response!

And the punchline is that no matter what Musk does, the USS Titanic remain fully on autopilot because while a few billion in discretionary spending here and there can be cut, neither entitlements (Social Security, Medicare) nor interest on the debt can be - without a default (it can however be inflated away... and it will be) - and in February, gross interest on the Federal debt hit a record $1.177 trillion in the past twelve months thanks to another $86 billion in interest spending.

Another way of looking at it: in the first five months of the fiscal year, the US has spent $480 billion on interest alone, the highest 5 month total ever.

What else to say? Well, we could lie to you and tell you that there is some hope and that DOGE will be able to fix this, but as much as we'd like that to be the case, we are now well beyond the Minsky Moment and for all the kicking and screaming, there is only one way all of this ends.