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 18,165.37 3.02 0.02%
Nasdaq 5,257.52 15.69 0.30%
S&P 500 2,142.43 1.09 0.05%
Treasuries 1.74 -0.01 -0.40%
Data as of 3:07pm ET
Company Price Change % Change
Reynolds American In... 54.04 6.87 14.56%
Chesapeake Energy Co... 6.66 -0.25 -3.55%
Microsoft Corp 59.81 2.56 4.47%
AT&T Inc 37.43 -1.22 -3.17%
General Electric Co 28.92 -0.15 -0.52%
Data as of 2:52pm ET


Wells Fargo's vast network of branches hasn't buckled much in recent years. But that may not change, experts say. More

Passes for the new National Museum of African-American History and Culture in Washington D.C. are 'sold out' through March 2017. More

Microsoft stock is soaring thanks to investments in cloud computing, a new approach to Office and a little financial engineering. More

The University of Illinois partnered with Coursera to launch one of the most affordable online MBA programs yet. More