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First Quarter Budget Deficit Reaches Record
Forbes/AFX News Limited
December 9, 2007

WASHINGTON (Thomson Financial) - A slowing economy has begun taking its toll on US government finances as the Treasury today reported record deficits for both the month of November and the first two months of its 2008 fiscal year, the latter being a record 153.8 bln usd.

The deficit for October and November, the first two months of the federal government's 2008 fiscal year, was up 26 pct from the previous same period, Treasury reported. Revenues were up 5 pct this year to 329.2 bln usd and spending up 11 pct to 483.0 bln usd.

The November deficit was 98.2 bln usd, up 34 pct from the same month in 2006. Economists polled by Thomson IFR Markets had predicted a 90.0 bln usd deficit.

Revenues grew 4 pct compared to last year, to 151.0 bln usd, as both individual and corporate income tax payments have slowed along with the economy.

There was no similar slowdown in spending on the war in Iraq or other federal programs and outlays rose 14 pct to 249.3 bln usd.

Treasury said, however, that part of the spending rise was because December 1 fell on a Saturday, pushing 17 bln usd of Social Security, Medicare and other payments back into November.

dennis.moore@thomson.com+dennis.moore@thomson.com

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