Another Record Deficit for 2010?
Friday the 13th… let’s start spooky: Just one month into the 2010 fiscal year, the U.S. government is on track for a record $2 trillion annual budget deficit.
That’s the word from the Treasury Department, which quietly announced a $176.4 billion October budget deficit yesterday. Oh, let us count the records… record-high deficit for all Octobers, record 13th straight month of budget deficit and the fifth largest monthly shortfall on the books. Should we maintain this trajectory for the rest of the fiscal year, Uncle Sam will have accrued a $2.11 trillion tab — a record deficit even compared with last year’s $1.4 trillion mess. The Congressional Budget Office currently projects a $1.4 billion deficit for 2010… wouldn’t that be nice?
“We’re seeing deficits projected for the next 10 years of over a trillion dollars a year,” said Sen. Judd Gregg of New Hampshire, implicitly explaining why he was pseudo-fired as Commerce secretary. “It’s not sustainable. It’s not fair and it’s not right.”
Nevertheless, the White House will soon begin petitioning Congress to raise the national debt ceiling yet again. On track to punch our public debt through the current “limit” of $12.1 trillion sometime in December, the Obama administration is rumored to be lobbying for a $1-1.5 trillion increase.
And get this… in a weak effort to placate increasing public ire, the Treasury has promised to pay off some of the national debt with TARP leftovers.
“We are likely to have to borrow substantially less than we initially anticipated to help repair the damage for our financial system,” Treasury Secretary Geithner admitted this week. “That is going to allow us to devote greater resources to debt reduction. That is a fundamentally good thing. It justifies the basic judgments the president made…”
Heh, forgive us for not feeling justified just yet, Mr. Geithner.
Current estimates from the Office of Management and Budget say the Treasury could use as much as 210 billion TARP bucks to pay down some debt. A drop in the bucket… but we’ll take what we can get.