WASHINGTON -- The government will run a $1.1 trillion deficit in the fiscal year that ends in September, a slight dip from last year but still very high by any measure, according to a budget report released yesterday.
The Congressional Budget Office report said annual deficits will remain in the $1 trillion range for the next several years if Bush-era tax cuts slated to expire in December are extended, as commonly assumed -- and if Congress is unable to live within the tight "caps" the lawmakers themselves placed on agency budgets last year.
The report is another reminder of the perilous fiscal situation the government is in, but it's commonly assumed that President Barack Obama and lawmakers in Congress will be able to accomplish little on the deficit issue during an election year.
The report was slightly more pessimistic than the Congressional Budget Office's projections last summer and would mean the fourth straight year of trillion-dollar-plus deficits.
The recent wave of shocking, trillion-dollar-plus deficits has been largely a product of the recent deep recession and the slower-than-hoped recovery. The jolt to the economy has made a permanent dent in revenue estimates but the budget crunch will get even worse as the Baby Boom generation retires, with the resulting strain on Social Security and Medicare.
The report prompted a familiar wave of statements from lawmakers casting blame on the other for the fiscal mess.
"Four straight years of trillion-dollar deficits, no credible plan to lift the crushing burden of debt," said House Budget Committee chairman Paul Ryan (R-Wis.). "The president and his party's leaders have fallen short in their duty to tackle our generation's most pressing fiscal and economic challenges."
"We will not solve this problem unless both sides, Democrats and Republicans, are willing to move off their fixed positions and find common ground," said Senate Budget Committee chairman Kent Conrad (D-N.D.). "Republicans must be willing to put revenue on the table."
Republicans acknowledge that Obama inherited a budget mess and an economy in recession, but they say he's done little to try to keep his 2009 promise to cut the deficit in half by the end of his first term.