Deficit Drops to Lowest Level Since Before the 2008 Financial Crash



The budget deficit in the U.S. shrank in the last fiscal year to the lowest level as a share of the economy since 2007 as faster growth and falling unemployment boosted tax receipts, the Treasury Department said.

The shortfall was $483.4 billion in the 12 months to Sept. 30, compared with $680.2 billion a year earlier, the Treasury said today in Washington. That’s about a third of the record $1.4 trillion deficit reached in 2009. Revenue jumped 8.9 percent and spending gained 1.4 percent, the figures showed.

Treasury Secretary Jacob J. Lew said the fiscal improvement is partly tied to stronger growth, as the nation’s unemployment rate dropped to 5.9 percent in September from 7.2 percent a year earlier. Still, the deficit is forecast by the Congressional Budget Office to start widening again as an aging population prompts more spending on Social Security and health care.

Deficit Continues to Drop But Low Corporate Tax Rates Threaten Outlook

Los Angeles Times:

The federal deficit continues to decline thanks to budget cuts and slower growth in Medicare costs, but lower than expected corporate tax revenues dimmed some of the improved outlook, according to a report Wednesday from the Congressional Budget Office…

Declining corporate tax revenues are largely to blame for a $26 billion dip in overall revenue projections from the non-partisan budget office’s April forecast, and the budget director called the change not particularly large, but “notable.”

News You Won’t See on Fox: U.S. Deficit Is Now at a Five-Year Low

According to the Associated Press:

For the first time in five years, the U.S. government has run a budget deficit below $1 trillion.

The government says the deficit for the 2013 budget year totaled $680.3 billion, down from $1.09 trillion in 2012. That’s the smallest imbalance since 2008, when the government ran a $458.6 billion deficit.

Steve Benen at MaddowBlog:


Good News for America, Bad News for the GOP – CBO Says Deficit Is Shrinking Faster Than at Any Time Since Post-World War II

Chart based on figures from the nonpartisan Congressional Budget Office showing the federal deficit for each year since the economy crashed at the end of the Bush administration

Good news, America. The federal deficit is shrinking faster than it has since the end of World War II, according to the nonpartisan Congressional Budget Office.

Oddly enough, however, this good news for the country — this sure sign that the United States is finally recovering from the economic crash at the end of the Bush administration — is actually horrible news for the Republican Party, which for the past five years has pinned its hopes on defeating Pres. Obama and the Democrats by deliberately hobbling the recovery with the hope that a weak economy would benefit them politically.


Federal Deficit Is Shrinking Even Faster Than Had Been Projected – But Fox Reports It As Bad News

There is good news about the economy — the nonpartisan Congressional Budget Office has reported that the federal budget deficit is reducing even more quickly than had been projected– so, naturally, it is being spun by Fox News as bad news:

Fox & Friends co-host Brian Kilmeade reacted to a new Congressional Budget Office (CBO) report showing the 2013 deficit dropping by $200 billion by lamenting that the report might discourage further austerity measures…

Kilmeade reacted to this news with calls for increased austerity, lamenting that the “positive news” in the CBO report might lead away from a mindset of “fiscal discipline.” Kilmeade concluded, “I just hope we still feel the urgency to get our budget in order.”

Rachel Maddow’s report follows:


Poll: 90% of Americans Mistakenly Believe the Deficit Is Rising Or Flat – Just 6% Know It Is Actually Shrinking

A Bloomberg poll released last week found that 90 percent of Americans hold the mistaken view that the U.S. deficit is rising or staying the same, when in fact it has been shrinking at a rapid pace since Pres. Obama took office.

Misunderstood Deficit: [The] size and trajectory of the U.S. deficit is poorly understood by most Americans, with 62 percent saying it’s getting bigger, 28 percent saying it’s staying about the same this year, and just 6 percent saying it’s shrinking. The Congressional Budget Office reported Feb. 6 that the federal budget deficit is getting smaller, falling to $845 billion this year — the first time in five years that the gap between taxes and spending will be less than $1 trillion.

Americans also have a skewed picture of what drives federal spending.


Another Romney Lie: Obama Has Not ‘Doubled’ the Federal Deficit, He Has Reduced It by Billions of Dollars


In the presidential debate, Mitt Romney said, “The president said he’d cut the deficit in half. Unfortunately, he doubled it.”

Unsurprisingly, the notion that the deficit has doubled over the last three years is a lie:

Late Friday afternoon, the Treasury Department published the official report on the U.S. budget deficit for the most recent fiscal year: $1.089 trillion. While that’s obviously still a very large budget shortfall, the deficit is $200 billion smaller than it was last year, and is nearly $300 billion smaller than when President Obama took office.

Even Politifact agrees, FWIW.

Frum: Romney is the Candidate of the Rich and the Old

Romney has now wholly identified himself as the candidate of the rich and the old. Nothing is to be asked from those over 55. Much is to be given to upper-income earners. All the burden of fiscal adjustment is to be piled on the poor and the young…Compassionate conservatism has been dead for a long time. Romney’s Detroit speech cremated the remains…he has now finally eliminated the policy differences separating him from the radical congressional wing. If Romney should win the Republican nomination, moderate and independent voters nationwide will be forced to decide: If they vote for Romney, who is it they’re truly voting for?

David Frum, neocon and former Bush II speechwriter