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  • U.S. Budget Deficit for Fiscal Year 2012 Already at $1 Trillion

    The federal budget is reaching benchmarks of astronomical proportions. Hold your applause, though; the budget trends are increasingly headed in the wrong direction.

    Yesterday, the Congressional Budget Office (CBO) reported that the deficit for fiscal year 2012 has surpassed the $1 trillion mark, and it anticipates the Treasury Department will report a $1.17 trillion deficit as of the end of August. The deficit can and will get worse, though, because a few weeks remain before the fiscal year ends on September 30th. Remember, too, that this marks the fourth year in a row with a $1 trillion plus deficit.

    CBO’s report follows Treasury’s grim confirmation last week that the national debt reached the $16 trillion mark, engulfing the size of the entire U.S. economy. That translates into $51,000 in debt per U.S. citizen, about what the average American will earn this year. Because of Washington’s overspending, the debt continues to climb upward toward the $16.394 trillion statutory limit allowed under the Budget Control Act of 2011 (BCA).

    Washington lacks the resolve to rein in federal spending, despite such negative report cards. Congress’ latest proposed spending bill, the FY2013 continuing resolution (CR) that will fund the government, doesn’t even freeze spending at current levels, as a typical CR would. The CBO estimates that level to be $1.039 trillion. Instead, lawmakers plan to increase discretionary spending by $8 billion, in order to reach the annual rate of $1.047 trillion provided under the BCA.

    If the current state of the budget appears gloomy, the future could prove to be downright awful. Absent reforms to entitlement programs—especially Medicare, Medicaid, and Social Security—federal spending will skyrocket. Deficits will reach unprecedented levels during the next few decades, causing debt to increase to economically stagnating levels. Taxpayers will be left to deal with the consequences. (continues below chart)

    Moody’s Investor Service today joined Standard & Poor’s in issuing a stern warning that it would likely lower the United States’ credit rating from AAA to Aa1, if Congress does not stabilize the debt-to-GDP ratio and address the coming fiscal cliff.

    Congress needs to stop dithering and get spending under control.

    Posted in Featured [slideshow_deploy]

    11 Responses to U.S. Budget Deficit for Fiscal Year 2012 Already at $1 Trillion

    1. blained13 says:

      If Obama wins you can most put it stone those deficits will continue, may even be that way under Romney as well. If Reid still controls the Senate, it could get messy again!

      • Jim w says:

        Doesn't matter the embedded entitlements will never be changed by either party. In 5 years the national debt will exceed GDP with much higher interest rates, a lower dollar and much higher unemployment. We will be Greece

    2. Bobbie says:

      Somebody's arithmetic, poor judgment and intentional inaccuracies continues to spend this country into bankruptcy without a conscience…

    3. SorryKids says:

      Surprised to see that no one made the comment that it's all Bush's fault…im sure it's coming

    4. Vince says:

      An illustration that speaks much better than words…unfortunately!

    5. Lloyd Scallan says:

      How can anyone not realize this is deliberate from Obama?

    6. Stirling says:

      "Government's view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it". – Ronald Reagan

    7. Emil says:

      Government needs to stop increasing entitlements automatically. I am not much of a fan of
      Ron Paul on foreign policy, but agreed with an article he contributed to Wall Street Journal (last winter?). He pointed out we need to stop calling it a "spending cut" when we just increase spending by a smaller percentage. The article suggested we could be out of debt and balance the budget in a few years.

    8. ToucheTurtle says:

      Perhaps the question of the day is: How many Americans REALLY believe it is a problem or even care? After all, this is the FOURTH year this has happened, and the shock value of such a staggering amount of shortfall is a thing of the past! I can just see it now . . . the country will FINALLY be bankrupt, the politicians will blame US because we wouldn't/couldn't sacrifice MORE so they could continue their financial rape of the American people! They will NEVER do what has to be done to save the country on their own . . . . we MUST demand compliance from THEM!!!!!

      UNLESS we have the resolve to CHANGE the human makeup in Washington, it is true that NOTHING in our financial future will truly change! We will indeed become GREECE, only in an exponentially bigger way!

    9. AgentGreen says:

      Is anyone else bothered by the "surplus" they continue to show at the end of the Clinton presidency? The national debt never declined year-over-year, so why is this charade continually paraded around as truth?

    10. Mike, Wichita Falls says:

      No more debt-ceiling deals, Boehner! Listen to your conservative caucus this time. Hold the line. We 51% of makers are tired of you wimps catering to the 49% of takers and the press who live in a bubble. If there aren't enough makers to support you this time, then the Republic is lost anyway. What good is it to hold onto your power if the Republic is spiraling down the toilet? Use your power to reverse course. What happens when the bennies dry up? It's no longer a 51/49 deal but a 100/0 deal.

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