Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

October deficit $176 billion

By Jeanne Sahadi, CNNMoney.com senior writer

NEW YORK (CNNMoney.com) -- October was another costly month for Uncle Sam. The Treasury Department reported on Thursday that federal coffers racked up a worse-than-expected deficit of $176.4 billion for the month.

It was the 13th straight month of a reported monthly deficit. Treasury said it was the largest October deficit on record.

October is the first month of the government's fiscal year, and at this reading, the Treasury is estimating that the annual deficit will hit $1.5 trillion. That would top the $1.42 trillion registered for 2009, which was the highest annual deficit since 1945.

Interest paid on the debt in October was $22.8 billion - or 7% of federal outlays for the month.

For the month, the Treasury took in $135.3 billion from various sources and spent $311.7 billion.

The administration has promised to deliver a deficit-reduction plan along with the president's proposed 2011 budget, which will be released early next year.

The call to reduce the deficit as soon as the economy regains its footing has grown louder in recent weeks as the country's accumulated debt will once again pierce the congressionally imposed debt ceiling sometime by the end of the year. As a result, lawmakers will have to vote to increase it from its current level of $12.1 trillion.

In anticipation of that vote, a group of lawmakers have been pushing for a bipartisan commission to be created to make a lot of the hard choices lawmakers have thus far avoided: how to rein in spending on Medicare and Social Security; how high to raise taxes on everyone, not just those making $250,000 or more; and which government funded programs to cut in part or altogether.

The person charged with drafting President Obama's deficit-reduction plan is White House Budget Director Peter Orszag.

Orszag told CNN on Thursday that the current deficit, as bad as it is, "is actually, ironically, helping the economy. The tax relief and additional spending helps to bolster demand when the economy is very weak."

But, he noted, by 2011, 2012 or 2013, too large a deficit will harm the economy by crowding out private investment. "We need to get ahead of that problem," Orszag said. To top of page

Index Last Change % Change
Dow 17,808.18 88.26 0.50%
Nasdaq 5,134.04 25.37 0.50%
S&P 500 2,092.45 12.04 0.58%
Treasuries 2.21 -0.01 -0.23%
Data as of 9:38am ET
Company Price Change % Change
Southwestern Energy ... 9.01 0.26 3.03%
Synchrony Financial 31.83 0.52 1.66%
Oracle Corp 38.97 -0.21 -0.54%
CONSOL Energy Inc 7.88 0.40 5.35%
Morgan Stanley 34.30 0.52 1.54%
Data as of Nov 30


Ford investing $1.3 billion in new body shop and other upgrades to build aluminum versions of Super Duty trucks at Kentucky plant, adding 2,000 jobs. More

Morgan Stanley says the middle class is "eroding." The rich are paying down their debt, the poor and middle class aren't. More

The AT&T customers still clinging to their unlimited data plans are going to see a $5 price hike in February. More

Hive, a startup funded by the UN, is tasked with getting more Americans engaged with the refugee crisis. More

Have you heard of Harvey Mudd College? A degree from this small liberal arts school can cost more than a house, but grads earn about $92,300 a year after getting their degree. Google hired 11 Mudders last year. More