WASHINGTON – The government started off the 2003 fiscal year with a $54 billion budget deficit, while the 2002 budget shortfall was slightly smaller than the government had earlier reported, the Treasury Department said Thursday.
The deficit posted in October ---- reflecting spending of $178.9 billion and revenues of $124.9 billion ---- dwarfed the $7.7 billion of red ink the government recorded for October 2001. It was bigger than some private economists forecast but in line with a projection made by the Congressional Budget Office.
CBO cited a number of reasons the deficit was much bigger in October compared with the same month a year ago.
Revenues in October 2001 got a big boost from a law that allowed corporations to pay an estimated $23 billion in income tax payments that month, rather than September, CBO said. Spending in October 2002, meanwhile, was higher than a year ago, with much of the increase for defense, Social Security, Medicare and unemployment benefits, CBO said.
For the entire 2002 budget year, which ended Sept. 30, the government ran up a deficit of $157.7 billion, Treasury said in revised figures released Thursday. That was a little better than the $158.5 billion shortfall previously reported Oct. 24, based on less complete data.
The government's spending for the 2002 budget year came in slightly less than originally reported, while revenues were a bit higher, leading to the small improvement. Spending in the 2002 budget year totaled $2.01 trillion and revenues came to $1.85 trillion, according to Treasury's revised figures.
The 2002 budget deficit ended four straight years of surpluses and followed a $127 billion surplus ---- the second biggest ever ---- for fiscal 2001.
Both the White House and the Congressional Budget Office expect annual surpluses to return in a few years.
The Bush administration has blamed the return of deficits on last year's recession and the costs of waging war in Afghanistan and battling terrorism at home. Democrats blame much of the red ink on President Bush's $1.35 trillion, 10-year tax cut, which Congress enacted last year.
In October, the biggest spending categories were Health and Human Services Department programs, including Medicare and Medicaid, $43.9 billion; Social Security, $40.9 billion; military, $28.8 billion; and interest on the public debt, $13.7 billion.
Individual income tax payments in October came to $67.7 billion, down from $77.8 billion for the same period last year.