The Times West Virginian

Headline News

October 13, 2012

U.S. deficit tops $1 trillion

WASHINGTON — 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.

 

1
Text Only
Headline News
  • Ukraine, Russia trade blame for shootout

    Within hours of an Easter morning shootout at a checkpoint manned by pro-Russia insurgents in eastern Ukraine, Russia’s Foreign Ministry issued a statement blaming militant Ukrainian nationalists and Russian state television stations aired pictures of supposed proof of their involvement in the attack that left at least three people dead.

    April 20, 2014

  • Governor: Closing Boston amid bomber hunt ‘tough’

    Several days after the Boston Marathon bombing, Gov. Deval Patrick received a call in the pre-dawn hours from a top aide telling him that police officers outside the city had just engaged in a ferocious gun battle with the two men suspected of setting the bombs and that one was dead and the other had fled.

    April 20, 2014

  • Everest avalanche reminder of risks Sherpas face

    The rescuers moved quickly, just minutes after the first block of ice tore loose from Mount Everest and started an avalanche that roared down the mountain, ripping through teams of guides hauling gear.
    But they couldn’t get there quickly enough.

    April 20, 2014

  • Colorado deaths stoke worries about pot edibles

    A college student eats more than the recommended dose of a marijuana-laced cookie and jumps to his death from a hotel balcony. A husband with no history of violence is accused of shooting his wife in the head, possibly after eating pot-infused candy.

    April 19, 2014

  • Everest avalanche kills at least 12

    An avalanche swept down a climbing route on Mount Everest early Friday, killing at least 12 Nepalese guides and leaving four missing in the deadliest disaster on the world’s highest peak. Several more were injured.

    April 19, 2014

  • Diplomacy doesn’t move insurgents in Ukraine

    Pro-Russian insurgents defiantly refused Friday to surrender their weapons or give up government buildings in eastern Ukraine, despite a diplomatic accord reached in Geneva and overtures from the government in Kiev.

    April 19, 2014

  • Clinton to Obama: Many parallels

    Thousands of pages of documents from President Bill Clinton’s White House affirm a longtime adage: The more things change, the more they stay the same.
    As Clinton prepared for an August 1994 news conference in which he hoped to build public support for his struggling — and ultimately unsuccessful — health care overhaul, he told his advisers: “A lot of them want to know they can keep their own plan if they like it.”

    April 19, 2014

  • Obama voices skepticism on Russia in Ukraine

    President Barack Obama conveyed skepticism Thursday about Russian promises to de-escalate a volatile situation in Ukraine, and said the United State and its allies are ready to impose fresh sanctions if Moscow doesn’t make good on its commitments.

    April 18, 2014

  • President defending health-care law good for some Democrats

    President Barack Obama’s full-throated defense of his health-care overhaul seems perfectly timed for Democrats who want their party to embrace the law more enthusiastically.
    At a White House news conference Thursday, Obama noted that health insurance enrollments under the new law are higher than expected, and costs are lower.

    April 18, 2014

  • Deal reached on calming Ukraine tensions — for now

    In a surprise accord, Ukraine and Russia agreed Thursday on tentative steps to halt violence and calm tensions along their shared border after more than a month of Cold War-style military posturing triggered by Moscow’s annexation of Crimea.

    April 18, 2014

House Ads
Featured Ads