Federal Budget Deficit Will Hit $1,000,000,000,000 For 5th Straight Year

Well, at least we’re being consistent:

The U.S. annual budget deficit is on track to reach $1 trillion for a fifth straight year, though government revenue jumped last month as people paid some taxes early to avoid higher rates in 2013.

The Treasury Department said Friday that the federal deficit grew just $260 million in December. But for the first three months of the budget year, the deficit widened to $292 billion.

The government has run annual deficits for more than a decade, although President Barack Obama’s presidency has coincided with four straight $1 trillion-plus deficits.

The deficit reached a record $1.41 trillion in budget year 2009, which began four months before Obama was inaugurated. That deficit was largely because of the worst recession since the Great Depression. Tax revenue plummeted, while the government spent more on stimulus programs.

The budget gaps in 2010 and 2011 were slightly lower than the 2009 deficit as a gradually strengthening economy generated more tax revenue.

Of course, we could avoid hitting $1 trillion for the fifth straight year if Congress and the President get their act together and reach a long term budget deal. Said deal will be announced by a parade of unicorns down Pennsylvania Avenue.

FILED UNDER: Congress, Deficit and Debt, Quick Takes, US Politics
Doug Mataconis
About Doug Mataconis
Doug holds a B.A. in Political Science from Rutgers University and J.D. from George Mason University School of Law. He joined the staff of OTB in May 2010. Before joining OTB, he wrote at Below The BeltwayThe Liberty Papers, and United Liberty Follow Doug on Twitter | Facebook

Comments

  1. alkali says:

    Of course, we could avoid hitting $1 trillion for the fifth straight year if Congress and the President get their act together and reach a long term budget deal.

    At this point, it seems unlikely absent significant revenue raisers or severe cuts, neither of which are likely to be included in FY2013 even if a deal is reached. If the economic recovery continues, there is a chance the deficit number could come in just under $1T.

  2. rudderpedals says:

    Too bad there isn’t a $1T coin.

  3. C. Clavin says:
  4. OzarkHillbilly says:

    Dogdamned House Republicans and their free spending ways..

  5. john personna says:

    Meanwhile, California to Post $851 Million Budget Surplus

    Free spending Democrats …

  6. Rafer Janders says:

    @john personna:

    According to Doug, though, you can’t call that a recovery.

    Why? Because hippies, that’s why!

  7. Tsar Nicholas says:

    We’ve already crossed the proverbial Rubicon when it comes to the deficit, a fact made all that more dire by the absurd accounting fiction of Social Security and Medicare being “off budget,” which is sort of akin to saying the money you owe on your home doesn’t really count because there are impound accounts at the bank to cover taxes and insurance. Being “off budget” sure as hell won’t help people make ends meet when those entitlements go bust. If Gen. Y were a dog it would be put down. Seriously, they’re simply not going to make it. No chance in hell.

    Perhaps the most gruesome irony with all of this is that it doesn’t take rocket science to balance a government budget. Rule # 1: Don’t spend more than you take in. Rule # 2: Don’t forget Rule # 1.

    Looking ahead, however, I for one am quite anxious for the domestic bond markets to implode. Not only because there’s money to be made short selling U.S. Treasury Notes. Because eventually it’ll make sense again to be a lender. Right now it’s a fool’s game to loan money in the U.S.. Prices are waaay too high and yields are waaaay too low. But bond prices won’t stay this high forever. And yields won’t stay this low forever. I’m looking forward to loaning money to various debtors after prices plummet and yields spike. California muni bonds certainly are on my eventual to-do list. Corporate debt. Asset backed loans. Since as a country we’re in any event completely FUBAR it’s high time some of us truly got to profit from this mess. At least that’s how I see things.

  8. Tony W says:

    Wait, it can’t be the 5th straight year, Obama has only been in office for 4 years! That would mean…..

  9. PJ says:

    @Rafer Janders:

    Why? Because hippies, that’s why!

    Hippies? No.

    CLASS WARFARE!

    California is poised to end its next fiscal year with an $851 million surplus, the first in more than a decade, Governor Jerry Brown said as he unveiled a budget that includes revenue from voter-approved tax increases.

    Moochers!!!!

    …boosted levies on income starting at $250,000 — reaching 13.3 percent on those making $1 million or more, the most of any state.

  10. bill says:

    from the prez who said such deficits were “un-American”!

  11. anjin-san says:

    Hippies? No.

    Hippies in drum circles!!

  12. Hal 10000 says:

    @C. Clavin:

    Krugman’s article is a piece of work. He has opposed almost all the policies that have reduced the deficit. He opposes further reduction, including the $1.4 to $3 trillion the CPPB says will be necessary to stabilize, not reduce, the debt. And he ignores that the CPPB chart includes fairly optimistic assumptions (which they acknowledge). Other than that, the usual fine analysis from whichever intern is writing his column this week.

  13. just 'nutha ig'rant cracker says:

    @Tsar Nicholas: “If Gen. Y were a dog it would be put down.”

    Are you tired of short selling or is there not enough money in it anymore?

  14. superdestroyer says:

    @john personna:

    The story actually says the the Brown Administration anticipates a budget surplus in the future and that it is due to budget gimmicks.

  15. superdestroyer says:

    I think Doug is optimistic about long term budget deals. One would think that after watching long term budget deals fail in the 1980’s and 1990’s, that people would have realized that there is no such thing as a long term budget deal. Congress only controls the budget for a two year time frame. Promising to make cuts more than two years from now is pure fiction.

  16. Tyrell says:

    The problem is decreasing revenues. Two reasons among many stand out:unemployment is still too high and many incomes are lower: many people who are working or have gone back to work are making less. The other factor is that the bill for two wars has come due. The president (Bush) should have appealed to the people to help pay for the war on terror. At the time there was widespread support and people would have became involved in paying for the war. It was the wrong time for a tax cut. Soldiers and their families should not be the only citizens called on to sacrifice.

  17. Tony W says:

    @Tyrell:

    Soldiers and their families should not be the only citizens called on to sacrifice.

    Thank you Tyrell. The income redistribution/consolidation that has happened over the past few decades, along with creation of an ‘honored military-class’, have destroyed the middle class, even while making us feel we can have our cake and eat it too.

    If we bring back the military draft and continue to raise tax rates on the highest earners the middle class will again stand a chance. It is infinitely harder to sell an expensive war/adventure when the sons and daughters of business executives and senators must go fight.

  18. C. Clavin says:

    “…At least that’s how I see things…”

    Which is pretty much the opposite of reality…as per usual.

  19. Justinian says:

    C. Calvin wrote:

    Krugman thinks you are a fizzy douche…

    In the article Krugman concludes his article with these words:

    So you heard it here first: while you weren’t looking, and the deficit scolds were doing their scolding, the deficit problem (such as it was) was being mostly solved.

    The government is borrowing more each day than a thousand workers earn in their entire lives, and Paul Krugman, Nobel-laureate economist, sees nothing of concern about it, nothing at all. And those who do are dismissed as “scolds.”

    Every day I’ve been alive, I have heard economists tell us how the U.S. Government needs to go further into debt in order to help the economy run smoothly. Every day. I’ve heard it ten thousand times.

    How can you tell when an economist is advising the U.S. Government to go further into debt? His lips are moving.