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National Debt

CBO Says Accounting Trick Lowers Deficit by $30B

  • October 29, 2012

    CapitolWatch reported recently that this year marks the fourth straight year of trillion dollar deficits under President Obama. The non-partisan Congressional Budget Office (CBO) reported a new estimate that places the federal deficit for the FY 2012 budget year, which ended on September 30th, at $1.1 trillion. The latest tally was initially slight improvement from the 2011 deficit of $1.3 trillion according to statements by the U.S. Treasury Department.

     

    Without the assistance from the calendar, the deficit in FY 2012 would have been $30 billion larger than in FY2011. This is due to a timing shift that put some final payments in FY2011 since Oct. 1, 2011 fell on a weekend.

     

    The final and official deficit numbers will be released by the Treasury Department in mid-October, but they should line up closely with the CBO estimate. Most troubling in the CBO’s findings is that our government borrowed 32 cents for every dollar it spent. These deficits have helped increase the national debt to over $16 trillion. Currently, the government is $417 billion from hitting the debt limit. This will require action from Congress, likely by year’s end, to address the limit. Last time the debt limit was increased, it was couple with the supercommittee, which failed to act, and has since triggered cuts to our national defense and Medicare to the tune of $1.1 trillion over 10 years. The cuts will be applied across the board on the government’s balance sheet.


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