Deficit Tops $1 Trillion for Fourth Straight Year Under Obama

Friday, 12 Oct 2012 09:48 PM

 

Share:
A    A   |
   Email Us   |
   Print   |
   Forward Article  |
  Copy Shortlink

The U.S. budget deficit has topped $1 trillion for a fourth straight year, but a modest improvement in economic growth helped narrow the gap by $207 billion compared with last year.

The Treasury Department said Friday the deficit for the 2012 budget year totaled $1.1 trillion. Tax revenue rose 6.4 percent from last year to more than $2.4 trillion, helping contain the deficit.

The government's revenue rose as more people got jobs and received income. Corporations also contributed more tax revenue than in 2011.

Government spending fell 1.7 percent to $3.5 trillion. The decline reflected, in part, less defense spending as U.S. military involvement in Iraq was winding down.

Barack Obama's presidency has now coincided with four straight $1 trillion-plus annual budget deficits — the first in history and an issue in an election campaign that ends in Nov. 6.

Obama's Republican challenger, Mitt Romney, contends that Obama failed to achieve a pledge to halve the deficit he inherited by the end of his first term.

When Obama took office in January 2009, the Congressional Budget Office forecast that the deficit for that year would total $1.2 trillion. It ended up at a record $1.41 trillion.

The increase was due, in part, to higher government spending to fight the worst recession since the Great Depression of the 1930s Tax cuts enacted under President George W. Bush and wars in Iraq and Afghanistan contributed to the deficits.

The budget gaps in 2010 and 2011 were slightly lower than the 2009 deficit as a gradually strengthening economy generated more tax revenue. But the deficits still exceeded $1 trillion.

Obama is campaigning for a second term with a pledge to cut deficits by $4 trillion over the next decade. He says he would do so by ending the Bush-era income tax cuts for higher-income Americans and by restraining the growth of spending.

Romney has said he would cut spending growth to help narrow the budget gap. He would cap spending at 20 percent of the economy by 2016. Spending in 2012 accounted for about 23 percent of the economy.

The government borrowed about 31 cents of every dollar it spent in 2012. The string of $1 trillion-plus deficits has driven the national debt above $16 trillion. The magnitude of that figure has intensified debate in Congress over spending and taxes but little movement toward compromise.

Many fear the budget deadlock will send the economy over a "fiscal cliff" next year, when tax increases and deep spending cuts will take effect unless a budget deal is reached.

Obama wants to eliminate the income tax cuts for families that make more than $250,000.

Republicans in Congress and Romney have resisted. They argue that with the economy still weak, the government should not be raising anyone's taxes.

Congress may address the budget crisis during a lame-duck session of Congress after the November elections.

© Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Share:
   Email Us   |
   Print   |
   Forward Article  |
  Copy Shortlink
Around the Web
Join the Newsmax Community
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
 
Hot Topics
Follow Newsmax
Like us
on Facebook
Follow us
on Twitter
Add us
on Google Plus
Around the Web
You May Also Like

Americans Just Don't Think Sebelius' Departure Will Matter Much

Wednesday, 16 Apr 2014 09:55 AM

The impending departure of Health and Human Services Secretary Kathleen Sebelius is bringing forth a kind of shrug from  . . .

Pope to Mafia Bosses: 'Stop Doing Evil'

Wednesday, 16 Apr 2014 09:46 AM

Pope Francis has signaled a war on organized crime in Italy after attending a prayer vigil with the families of Mafia vi . . .

Romney's Son Tweets Taunt to Reid: My Dad Pays His Taxes

Wednesday, 16 Apr 2014 09:39 AM

It's been almost two years, but Mitt Romney's son Josh hasn't forgotten Senate Majority Leader Harry Reid's insistence t . . .

Newsmax, Moneynews, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, NewsmaxWorld, NewsmaxHealth, are trademarks of Newsmax Media, Inc.

 
NEWSMAX.COM
America's News Page
©  Newsmax Media, Inc.
All Rights Reserved