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.

2010 deficit near $1.3 trillion

By Jeanne Sahadi, senior writer


NEW YORK (CNNMoney.com) -- The federal government ran a deficit of nearly $1.3 trillion in the fiscal year that ended Sept. 30, according to preliminary estimates released Thursday by the Congressional Budget Office.

The Treasury Department will deliver the official deficit numbers later this month.

According to CBO, the fiscal year 2010 deficit came in $125 billion below last year -- the worst on record since World War II.

The gap narrowed slightly because tax receipts were higher and spending lower than last year.

On the tax front, corporate revenue rose by $53 billion, or 39%, from 2009. Stronger corporate profits were the result of improved economic conditions and more generous rules for writing off business expenses.

The Federal Reserve's investments in the housing market and other areas of the economy also paid off for Uncle Sam. Receipts from the Fed to the Treasury rose $42 billion, or 121%, over 2009.

Overall government spending fell. The costs of the Troubled Asset Relief Program, which just ended, and payments to mortgage giants Fannie Mae and Freddie Mac declined. The same is true for funds spent on federal deposit insurance.

But other than that, the CBO reported, spending rose at a faster pace -- 9% -- than it has in awhile. Much of that increase was due to greater spending on the unemployed, on benefits for Medicare, Medicaid and Social Security and various provisions in the 2009 Recovery Act.

The federal cost of benefits for the jobless alone rose by 34% as the economy continued to suffer high rates of unemployment.

Interest payments on the debt also rose 13%. To top of page

Search for Jobs

Index Last Change % Change
Dow 18,413.34 -58.83 -0.32%
Nasdaq 5,136.71 -3.10 -0.06%
S&P 500 2,162.45 -4.13 -0.19%
Treasuries 1.52 0.01 0.53%
Data as of 10:33am ET
Company Price Change % Change
Ford Motor Co 12.50 -1.34 -9.69%
Facebook Inc 127.09 3.75 3.04%
Bank of America Corp... 14.56 -0.07 -0.48%
Apple Inc 103.91 0.96 0.94%
Boston Scientific Co... 23.92 0.26 1.10%
Data as of 10:18am ET
Sponsors

Sections

HSBC banker arrested at JFK airport as he prepared to leave the country. He and former trader face federal charges they manipulated currency trades. More

Americans are growing more hesitant to eat out. Whether the slowdown is being driven by rising prices, slowing job growth or even terrorism, some believe it could be the start of a painful restaurant recession. More

It's about to get harder for some luxury all-cash home buyers to hide their identity from the U.S. government. More