Make us your home page
Instagram

Federal deficit of $150.4B November's biggest ever

WASHINGTON — The federal budget deficit rose to $150.4 billion last month, the largest November gap on record. And the government's deficits are set to climb if Congress passes a tax-cut plan that's estimated to cost $855 billion over two years.

The Treasury Department says November's budget gap was 25 percent more than the deficit in November 2009.

For the first two months of the current budget year, which began Oct. 1, the deficit totals $290.8 billion. That's 2 percent less than for the same period a year ago. Economists had been estimating that the full-year deficit would decline after two years of record highs.

But analysts say the tax deal President Barack Obama reached with Republicans this week will give the 2011 budget year the largest deficit in history — $1.5 trillion, according to economists at JPMorgan Chase — and would mark the third straight year of trillion-dollar-plus deficits.

Under the tax cut plan, JPMor­gan economist Michael Feroli said he expects a $1.5 trillion deficit this year to be followed by a $1.2 trillion gap in 2012.

While many economists expected the Bush-era tax cuts would be extended and reflected that in their deficit forecasts for coming years, they had not factored in other parts of the tax-cut package including a 2-percentage-point reduction in the Social Security payroll tax for next year, taking the tax for individuals from 6.2 percent to 4.2 percent, at a cost to the government of $112 billion over the next year.

Before the tax cut agreement, many private economists were forecasting that the deficits would start to slowly fall in coming years. The major Wall Street firms that serve as primary dealers for the government's debt auctions projected last month that the 2011 deficit will dip to $1.21 trillion and decline further to $1.02 trillion in 2012.

The 2009 deficit is the current all-time high, at $1.42 trillion. The second-highest deficit ever is the $1.29 trillion deficit for the 2010 budget year, which ended Sept. 30.

Economists do expect the tax cut package, which the Senate is expected to begin voting on Monday, to boost economic growth.

.Fast facts

Trade gap shrinks

The U.S. trade deficit fell to its lowest level in nine months in October as growing demand for U.S. goods overseas and a falling dollar pushed exports to their highest level in more than two years. The trade deficit narrowed to $38.7 billion in October, the Commerce Department reported Friday, 13.2 percent below September's deficit of $44.6 billion. U.S. exports rose 3.2 percent to $158.7 billion, the highest level since August 2008. Sales of American-made machinery, farm products and autos fueled the growth. Imports dipped 0.5 percent to $197.4 billion, with lower demand for oil and foreign-made cars.

Federal deficit of $150.4B November's biggest ever 12/10/10 [Last modified: Monday, November 7, 2011 1:40pm]
Photo reprints | Article reprints

Copyright: For copyright information, please check with the distributor of this item, Associated Press.
    

Join the discussion: Click to view comments, add yours

Loading...
  1. Trigaux: As Florida seeks top 10 status as best business state, red flag rises on workforce

    Business

    In the eternal quest to appeal more to business than other states, Florida's managed to haul itself out of some pretty mediocre years. After scoring an impressive 8 among 50 states way back in 2007, Florida suffered horribly during and immediately after the recession. Its rank sank as low as No. 30 only four years ago, …

    Florida's trying to make strides in preparing its high school and college graduates for the rapidly changing skill sets of today's workforce. But the latest CNBC ranking of the best and worst states for business gave Florida poor marks for education, ranking No. 40 (tied with South Carolina for education) among the 50 states. Still, Florida ranked No. 12 overall in the best business states annual ranking. [Alan Berner/Seattle Times]
  2. Florida: White man who killed black person to be executed

    State Roundup

    GAINESVILLE — For the first time in state history, Florida is expecting to execute a white man for killing a black person — and it plans to do so with help of a drug that has never been used previously in any U.S. execution.

    This undated photo provided by the Florida Department of Corrections shows Mark Asay. If his final appeals are denied, Asay is to die by lethal injection after 6 p.m. Thursday. Asay was convicted by a jury of two racially motivated, premeditated murders in Jacksonville in 1987.  [Florida Department of Corrections via AP]
  3. Can the Bad Boys Mowers Gasparilla Bowl thrive in competitive sports market?

    Business

    ST. PETERSBURG — It's a funky name: the Bad Boys Mowers Gasparilla Bowl. But the new sponsors for the former St. Petersburg Bowl might need more than an eye-catching name to create a thriving, profitable contest.

    NC State head coach Dave Doeren clutches the championship trophy after winning the Bitcoin Bowl at Tropicana Field in St. Petersburg in 2014. Bowl organizers are changing the name of the game to the Bad Boy Mowers Gasparilla Bowl.
[

MONICA HERNDON | TIMES]
  4. Apple Scales Back Its Ambitions for a Self-Driving Car

    Autos

    SAN FRANCISCO — As new employees were brought into Apple's secret effort to create a self-driving car a few years ago, managers told them that they were working on the company's next big thing: A product that would take on Detroit and disrupt the automobile industry.

     In this Monday, April 10, 2017 file photo, Luminar CEO Austin Russell monitors a 3D lidar map on a demonstration drive in San Francisco. Russell, now 22, was barely old enough to drive when he set out to create a safer navigation system for robot-controlled cars. His ambitions are about to be tested five years after he co-founded Luminar Technologies, a Silicon Valley startup trying to steer the rapidly expanding self-driving car industry in a new direction. Apple says it will scale back its amitions to build a self-driving car.  [AP Photo/Ben Margot]
  5. Groundbreaking today for complex on old Tampa Tribune site

    Real Estate

    TAMPA — A groundbreaking is slated for 10 a.m. today for a 400-unit apartment complex planned on the site of the former Tampa Tribune building in downtown Tampa.

    Renderings for a high-end apartment complex that will be built on the Tampa Tribune site in downtown Tampa. 
[Courtesy of Related Group]