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Feds Have $118B Deficit for Year

July 19, 2002

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WASHINGTON (AP) _ The government is running a deficit of $118 billion for the first nine months of the budget year, a reversal from the sizable surplus recorded for the same period a year earlier.

The latest snapshot of the government’s finances, released Friday by the Treasury Department, seemed to reinforce the view expressed by government and private analysts that the United States will post a hefty deficit for the fiscal year.

The Bush administration now expects the government will run a $165 billion deficit in the 2002 budget year, ending Sept. 30. That would be the first red ink in four years, and $59 billion worse than the administration estimated in February.

For the first nine months of fiscal 2002, which started Oct. 1, government spending totaled $1.5 trillion, a 7.5 percent increase over the same period the previous year. Total revenues this budget year so far are $1.4 trillion, an 11.4 percent decline.

There was a $168.9 billion surplus for the first nine months of fiscal 2001.

The 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. But Democrats say it was caused by the 10-year, $1.35 trillion tax cut that Bush pushed through Congress in the spring.

So far this budget year, the biggest spending categories were Social Security, $365.5 billion; Health and Human Services Department programs, including Medicare and Medicaid, $346.6 billion; interest on the public debt, $284.7 billion; and military, $245.1 billion.

Revenues from individual income-tax payments so far this budget year came to $643.3 billion, a 19.6 percent drop from the same period last year. Revenues from corporate tax payments were down 15.9 percent to $115.9 billion.

In June, the government posted a surplus of $29.1 billion, down from a bounty of $31.9 billion for the same month last year.

For all of fiscal 2001, which ended Sept. 30, the government had a budget surplus of $127 billion, about half the previous year’s record total of $237 billion.


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