WASHINGTON – With one month to go in the 2004 federal budget year, the government recorded a deficit of $436.9 billion thus far, the Treasury Department (search) reported Monday. That's 9 percent larger than the $400.5 billion shortfall for the corresponding period last year. From Oct. 1, 2003, through August, spending has totaled $2.11 trillion, up 5.9 percent from the same period a year ago. Revenues came to $1.67 trillion — a 5.2 percent increase from a year ago.
So far this year, the biggest spending categories are programs from the Health and Human Services Department, including Medicare (search) and Medicaid, $497.1 billion; Social Security (search), $485.9 billion; military, $398.2 billion; and interest on the public debt, $309 billion.
On the revenue side, individual income tax payments came to $719.8 billion for the 11 months of the 2004 budget year, up from $704.2 billion for the corresponding period a year ago. Corporate income tax payments totaled $147.1 billion, a 45 percent increase from the same period last year.
The Congressional Budget Office (search) is forecasting a $422 billion budget deficit for this budget year. That would be a record in dollar terms but falls short of more dire projections made earlier in the year.
The government produced a record $374 billion deficit last year.
Democratic presidential candidate John Kerry argues that the yawning federal budget deficits are evidence that President Bush's economic policies are flawed. The president's tax cuts have mainly benefited the wealthy, squeezed the middle class and made the deficit worse, Kerry says.
The Bush administration counters that the tax cuts kept the 2001 recession from being worse and helped the current economic rebound. The deficits also reflect the costs of fighting wars abroad and combating terrorism at home, the administration says.