CBO Says Federal Deficit Hit Record $1.4 Trillion for Fiscal Year 2009
EmailABC News' Matthew Jaffe reports: The federal deficit reached a record $1.4 trillion in the 2009 fiscal year, according to an analysis released Wednesday by the Congressional Budget Office. The report is not the actual deficit figure, which will be released later this month by the Treasury Department. The year’s record-high deficit of $1.4 trillion equaled 9.9 percent of the nation’s gross domestic product, the CBO said. It is the highest shortfall relative to the size of the overall economy since 1945. The record shortfall stems from an increase in spending to stop the recession, bailout the financial industry, and take over mortgage giants Fannie Mae and Freddie Mac, as well as a decline in tax revenues. For the year, CBO said revenues dropped by $420 billion from 2008 receipts, a fall of 17 percent. The revenues totaled about 15 percent of GDP, the CBO found, the lowest level in more than half a century. Meanwhile, outlays were up $530 billion from a year earlier, an 18 percent increase, equal to nearly 25 percent of GDP, the highest level in more than half a century. The previous record deficit of $459 billion was set last year by the Bush administration. In August, the Obama administration projected the year-end deficit to be $1.58 trillion. The CBO’s estimate is based on daily Treasury statements and CBO’s own projections.
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While this year was an extraordinary year, obviously these type of deficits will not continue. In fact this country had better start running some budget surpluses pretty soon to bring down and hopefully one day eliminate the federal debt. Get ready to see your taxes increase substantially along with massive spending cuts, including social security and medicare.
Posted by: Ben Dover | October 7, 2009, 7:35 pm 7:35 pm
Obama never promised to reduce or deal with the deficit and so it is no surprise that the deficit has been sky rocketing. The spending has only increased and the cost of government operations has not seen any decline. It is therefore not a surprise that the deficit is at record levels. What is shocking is that neither the congress or the treasury secretary seem to be concerned even one bit. We are hearing about private companies have returned to profitability and only way they have managed that is by reducing operating costs by a significant numbers while accepting a reduction of revenues. Tax increases are not the solution
Posted by: gjkotw01 | October 7, 2009, 8:16 pm 8:16 pm
Before everyone starts blaming Obama for this, remember that the FY 2009 budget went into affect on 10/1/08 which would have been approved by Bush.
Posted by: d11670 | October 7, 2009, 8:26 pm 8:26 pm
Eight years ago and,for the first time in its history, America went to, not one, but two wars without a tax increase. Then we all stood by and watched Bush and friends, with help from congressional Dems, drive the economy off the cliff in the name of “deregulation.” To be sure, cut spending as much as possible. But, when the top 5% of the population has more wealth than the rest of comibined, its well past time for a substantial TAX INCREASE. Of course, that won’t happen because those “5% ers” and their corporations “own” the government.
Posted by: B. Bear | October 7, 2009, 8:33 pm 8:33 pm
Including the spending for the recovery programs for many have been praising President Obama, d11670? I don’t blame him for the deficit outright, but I don’t believe that all the spending was in the budget that Bush signed in ’08, nor do I believe that the president can blame all of this on Bush.
Posted by: Publius | October 7, 2009, 8:34 pm 8:34 pm
Spend, spend, spend… 4 more years of this and all our money will be going straight to the Government. Somebody needs to get this out of control spending under control. It`s almost as if they are ‘trying’ to destroy the Country.
Posted by: Scott T | October 7, 2009, 8:34 pm 8:34 pm
Who cares. I’m so giddy with Hope and Change. I’m sure everything will work out just fine.
Posted by: Me | October 7, 2009, 9:04 pm 9:04 pm
Almost every Republican has voted against TARP and stimulus. This debt belongs to Bush and the Democrats. Don’t get me wrong…Bush still sucks.
Posted by: Im Poor | October 7, 2009, 9:21 pm 9:21 pm
Obama during Third Presidential Debate…”Now, what I’ve done throughout this campaign is to propose a net spending cut.”
I’m tired of hearing excuses from people trying to defend Obama. Americans need to stand up to this out of control Welfare State spending. Obama does not have to spend all this money!
Posted by: Reality | October 7, 2009, 9:23 pm 9:23 pm
What’s not to like? Higher taxes, devalued dollar, higher taxes, eventually double digit interest rates, high taxes, unemployment that will approach 15% and won’t see even 8% for 7 years, higher taxes, 3/4 of homes with mortgages worth more than the home, higher taxes, hope and change, higher taxes!!!!
Posted by: WhatsComing | October 7, 2009, 9:25 pm 9:25 pm
I’m surprised that it appears like it is actually coming in UNDER the Administration’s prediction. It’s not a pretty figure (budgets in a recession never are), but it is incredibly refreshing that it appears that we’re back to a Whitehouse that doesn’t play games to hide it (how many ‘emergency’ bills does it take to fund ongoing war operations after 4 or 5 years???). I would be curious if it is under the predicted deficit due to lower spending or higher receipts.
Posted by: jhw539 | October 7, 2009, 9:43 pm 9:43 pm
Too bad we can’t have the $3 Trillion back that were spending on Iraq!
Posted by: tom | October 7, 2009, 10:22 pm 10:22 pm
We can always sell Alaska.
Posted by: Jim Bob | October 7, 2009, 10:24 pm 10:24 pm
Just Obama’s “Era of Responsibility” in play. Nothing to see here. Move along.
Posted by: Chuck | October 7, 2009, 10:36 pm 10:36 pm
Hasn’t anyone heard that “The road to hell is paved with good intentions”? Throwing money at problems does not solve the problem. Handing fist fulls of money to community organizers does not mean the money will get past their own pockets. What ever happened to personal accountability? It does not have a price tag. The thieves and crooks have played the whoa me violin to get the sympathies of our gullible or complicit politicians. Consequences are no longer dealt out to the offenders it’s being laid on the backs of those that strive to live lives of civility and self-reliance.
Posted by: TX_MBell | October 7, 2009, 10:41 pm 10:41 pm
Obama is looking to spend 10 TRILLION on welfare spending not including Healthcare and Cap n’ Trade. 3 Trillion on Iraq over a period of years is not good, but wake up America!!!.
Posted by: Let's Get Real | October 7, 2009, 11:17 pm 11:17 pm
This is just the first 8 months!!!
Posted by: Bobo Juice | October 7, 2009, 11:19 pm 11:19 pm
Hey Obama and Dems…Stop CHOKING small business, cut taxes, regulations, and STOP THE SPENDING!
Posted by: Don | October 7, 2009, 11:28 pm 11:28 pm
Just keep shoveling that money out of the printing presses there Obama… You’ll get yourself out of office in one term and it won’t be soon enough for we who live in the real world.
Posted by: Jon | October 7, 2009, 11:33 pm 11:33 pm
“Obama is looking to spend 10 TRILLION on welfare spending not including Healthcare and Cap n’ Trade.”
Let’s Get Real | Oct 7, 2009 11:17:59 PM
As long as you’re making up numbers out of thin air why not say 10 QUINTILLION or something?
“Stop CHOKING small business, cut taxes, regulations, and STOP THE SPENDING!”
Don | Oct 7, 2009 11:28:50 PM
Yeah, because those 8 years of tax cuts and muzzled regulators under Bush and the Republican Congress have worked out so well. Do you think we’re too stupid to remember the last 8 years? Taxes for the highest earners are lower than the last year of Reagan’s cuts, overall lower than since the age of the robber barons, and so low that over 40% of people have fallen off the income tax roles entirely (thanks in large part to the earned income credit created by Reagan). We’ve been seeing tax cuts for 28 years – tax cut and charge it to the national debt is the Republican dogma. And yes, we’re going to have to pay for their failed dogma now.
Posted by: jhw539 | October 7, 2009, 11:35 pm 11:35 pm
Those of us with open minds know that the present financial problems were inherited by the current administration, not caused by it. Also some of the bailouts and stimulus was started by the previous administration. Based on the recovery to date I am optimistic and know the global economy would be much worse today had these programs not been put into place. Most of my 401K, mutual funds and other investments are almost back to the even point before everything went south. Can I credit Obama for this, no. Can I place a lot of blame on Bush for the mess to begin with, most certainly.
Posted by: The way it is | October 7, 2009, 11:37 pm 11:37 pm
No worries guys – enjoy this days! After a month or two, when the world starts to dump and reject the worthless US greenback, this days will look as “those old days” in the paradise! The US caused too much pain and strife around the world – it is time to face hers own karma! Tighten the belt for hard landing – from 30,000 feet at free fall speed!
Posted by: TomTom | October 7, 2009, 11:41 pm 11:41 pm
Obama already budgeted 3.4 Trillion for FY 2010. Can’t wait for the economy to collapse.
Posted by: Don | October 7, 2009, 11:48 pm 11:48 pm
According to President Obama’s budget projections, federal and state welfare spending will total $10.3 trillion over the next 10 years (FY 2009 to FY 2018). This spending will equal $250,000 for each person currently living in poverty in the U.S., or $1 million for a poor family of four.
Posted by: Don | October 7, 2009, 11:48 pm 11:48 pm
Obama inherited a bucket of water; that’s what he inherited. Obama is getting out the fire hose.
Posted by: Fire Hose | October 7, 2009, 11:51 pm 11:51 pm
TAX THE SUPER WEALTHY! END CORPORATE CEO BAIL OUTS!
Seriously, this money is not impossible to obtain. Fat cat CEOs who have their companies bailed out by OUR tax money do not need multi million dollar retirement packages and bonuses. That right there would bring a lot back.
What about taxing people fairly based on what they earn? The poor should not pay taxes, the middle class not too much, while the top 1% (and let’s be honest, most of them have inherited that money, not earned it through their personal genius like bill gates) can share a heavier part of the burden.
I do not buy the idea that if we tax the rich then they will not create jobs, nor the idea that if we give them tax breaks that it will “trickle down” these are just lies to give breaks to the people who finance elections. GET BIG BUSINESS OUT OF GOVERNMENT.
Posted by: williamm | October 8, 2009, 12:31 am 12:31 am
Obama never promised to reduce or deal with the deficit and so it is no surprise that the deficit has been sky rocketing.
_______________________________________
The Fiscal Year 2009 budget was a Bush budget, not an Obama budget…..
Posted by: dk | October 8, 2009, 1:17 am 1:17 am
The spending mania must stop. They want to buy votes using spending and debt. Don’t fall for the blandishment of left or right.
Posted by: Michael R. Brown | October 8, 2009, 1:18 am 1:18 am
What’s not to like? Higher taxes, devalued dollar, higher taxes, eventually double digit interest rates, high taxes, unemployment that will approach 15% and won’t see even 8% for 7 years, higher taxes, 3/4 of homes with mortgages worth more than the home, higher taxes, hope and change, higher taxes!!!!
Posted by: WhatsComing | Oct 7, 2009 9:25:43 PM
=============================
Eh, want to cite anything (for instance, did YOUR taxes go up?) or just keep throwing out tired old catch-phrases that naive people hold on to?
Terrorism, 9/11, Freedom and the constitution! Country music, big brother, socialism and hitler! Hamburgers, american football, the flag and the pledge of allegiance!!! USA AND GOD, WHITE PEOPLE AND CORN DOGS!!! PALIN 2012!!!!
Perhaps you have something to propose to solve a problem which is more than 8 months old? A problem deeper than you can probably comprehend? One the delves into the nature of democracy, capitalism and free enterprise, big corporations, accountability, oversight, regulations, and so on? It’s a little more complicated than what you right wing “party of no” reactionary conservatives think.
Posted by: williamm | October 8, 2009, 1:28 am 1:28 am
Attn. republicans: The democrats (they’re the one’s that won) believe that in a massive recession the last thing the government needs to do is put a stop order on spending because it might make the recession get worse. See, if you tighten your belt too much you stand to make things worse. Hence the way they’ve been operating. They will not change this theory no matter how hard you whine. And whine. And whine.
Posted by: secondlook | October 8, 2009, 1:30 am 1:30 am
…and the dollar has taken even MORE of a nose-dive over the past several days, making even MORE difficult for us to pay back our creditors, like China.
I wonder, will China do as we did back in our hey-day, where we would forgive the debts of “Banana Republics.” If so, then there’s a chance we won;t have to pay them back, as we are clearly headed for “Banana Republic” status in the world.
Get used to it, everyone!
Posted by: Namako_H3 | October 8, 2009, 1:34 am 1:34 am
Jim Bob: No we can’t sell Alaska, because the Russians (or anyone else really) would only offer us debt for it, vice real money. As a country, we need to get back on the treadmill and get real. You can’t just postpone everything; eventually the debt comes due.
Posted by: Patrick | October 8, 2009, 2:20 am 2:20 am
787 BILLION fake stimulus was not part of Bush’s budget. Obama promised a lot but is delivering much worse.
Posted by: Hello | October 8, 2009, 2:45 am 2:45 am
Obama LIED. He promised a “net spending cut” during the campaign. Bashed Bush for his spending and the status quo. Now they are finding indirect ways to take our money, a.k.a VAT tax and who knows what else.
Posted by: Obama is Liar | October 8, 2009, 2:49 am 2:49 am
Too bad we can’t have the $3 Trillion back that were spending on Iraq!
Posted by: tom | Oct 7, 2009 10:22:32 PM
Too bad between both wars we’ve spent only 25% that number.
Posted by: Kurosekiryu | October 8, 2009, 5:15 pm 5:15 pm
jhw, did Obama lower taxes to those oh so wonderful rates you seem to think are so LOW? I must have missed that one.
Posted by: whatsgoingonhere? | October 8, 2009, 5:21 pm 5:21 pm