Government

CBO Predicts: 2011 Budget Deficit to Hit Record $1.5 Trillion

Washington (AP) — New budget estimates released Wednesday predict the government’s deficit will hit almost $1.5 trillion this year, a new record.

The daunting numbers mean that the government will have to borrow 40 cents for every dollar it spends.

The new Congressional Budget Office estimates will add fuel to a raging debate over cutting spending and looming legislation that’s required to allow the government to borrow more money as the national debt nears the $14.3 trillion cap set by law. Republicans controlling the House say there‘s no way they’ll raise the limit without significant cuts in spending, starting with a government funding bill that will advance next month.

The CBO analysis predicts the economy will grow by 3.1 percent this year, but that joblessness will remain above 9 percent this year. Dauntingly for President Obama, the nonpartisan agency estimates a nationwide unemployment rate of 8.2 percent on Election Day in 2012.

The latest figures are up from previous estimates because of bipartisan legislation passed in December that extended Bush-era tax cuts, unemployment benefits for the long-term jobless and provided a 2 percent payroll tax cut this year.

That measure added almost $400 billion to this year’s deficit, CBO says.

The deficit is on track to beat the record of $1.4 trillion set in 2009. That figure reflected huge outlays from the Wall St. bailout. The nonpartisan budget agency predicts the deficit will drop to $1.1 trillion next year.

“The fiscal challenge confronting us is enormous. To solve this problem, it will require real compromise and a great deal of political will,” said Budget Committee Chairman Kent Conrad, D-N.D. “We need to have both sides, Democrats and Republicans, willing to move off their fixed positions and find common ground.”

Comments (92)

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  • kramh
    Posted on January 26, 2011 at 12:32pm

    A 10% cut is is way to small. This has to be much deeper to matter. Everyone has to take a major haircut.

    Report Post »  
    • Passerby
      Posted on January 27, 2011 at 1:08am

      Do we take 10% out of all bank accounts and other savings, or do we just steal the social security savings of the poor and let them eat cake?

      Report Post » Passerby  
  • 8jrts
    Posted on January 26, 2011 at 12:31pm

    Center of Spooky Dude’s open arms.

    Report Post » 8jrts  
  • FreedomIQ
    Posted on January 26, 2011 at 12:29pm

    Time for them to start cutting whole departments and placing these useless looters in the unemployment ranks. As if!

    Report Post »  
  • infi888
    Posted on January 26, 2011 at 12:28pm

    that’s some serious debt, im going to switch my currency to canadian. and then use it to buy more dollars

    Report Post »  
  • RightPolitically
    Posted on January 26, 2011 at 12:23pm

    Put all able bodied poor to work in government agencies and get them off entitlements. Outlaw government service unions altogether (it should be an honor to work for our nation), immediately lower income payroll taxes by 25% across the board, corporate taxes ALTOGETHER and DUMP the IRS…….I would then HAVE CONGRESS PASS a balanced budget amendment IMMEDIATELY. If these measures were taken, America would once again be ON TOP of the world!

    Report Post » RightPolitically  
    • orcainohio
      Posted on January 26, 2011 at 8:52pm

      I think payroll taxes should be abolished altogether and any deductions on a paycheck , the person who worked should get it all first !

      Report Post »  
  • Snowleopard {gallery of cat folks}
    Posted on January 26, 2011 at 12:12pm

    One way I just thought of we can know when the U.S. dollars are not being made by the worlds counterfeiters – nation backed and individuals – as the cost of supplies to make them would be more than what the actual money they could fake would be worth.

    Somehow I feel that time is not too far off into the future.

    Report Post » Snowleopard {gallery of cat folks}  
  • Ghandi was a Republican
    Posted on January 26, 2011 at 12:10pm

    -
    It is the Pelosi-obama spending spree of $6 Trillion over 4 years we have to thank.
    The only reason we are in this mess. The subprime, energy and debt issues must be addressed in the context of how we got here.. Democrats. Cloward-pivenist Alinky-ites..

    Report Post » Ghandi was a Republican  
  • OkiePatriot
    Posted on January 26, 2011 at 12:04pm

    To sum it up, we’re screwed!

    Our government got us in this mess but they wont be able to get us out. The America I knew as a kid is gone and never coming back. We are in for some real change thats gonna hurt at all levels and everyone will be affected…the hurts coming, no way around it!

    Report Post »  
    • GhostOfJefferson
      Posted on January 26, 2011 at 12:44pm

      The current government is not the people, is not our culture. They can come and go, we remain.

      My son just did a presentation for his 8th grade history class on the 2nd Amendment (assigned by the teacher). He outlined that it wasn’t about hunting or sport so much as it was to provide a check against both foreign invasion AND against domestic tyrants. He and his group did a video about the real meaning of the 2nd Amendment. This project was a major part of his grade, and he got a perfect score on it. Does that sound like America as a people, as a nation, that is gone?

      His Boy Scout troop is huge and growing, are very well run and strict, and produces the most Eagle Scouts in central Ohio. Does that sound like America as a people, as a nation, that is gone?

      We have family oriented shooting ranges (with machine gun rental available at most of them) that advertise openly on the radio and television here, and in the newspapers with the numerous gun shops. No stigma. In fact the commercials are light, interesting and the ranges really do attract families coming in for recreation, business meetings get held at them sometimes, and hunting is actually *growing* here. Does that sound like America as a people, as a nation, that is gone?

      Our new governor ran on a platform of *eliminating* the state income tax, on massively rolling back government across the board, and on privatizing pretty much everything under the sun. He openly declared that he was taking no guff. He was part of the tea party movement back before it was popular and he routinely criticized both the GOP and the Dems. He won and was sworn in 1.5 weeks ago. Does that sound like America as a people, as a nation, that is gone?

      Nah, America isn’t dead, it’s not even wounded. The federal government on the other hand is a flailing nasty beast that is trying its best to destroy us. It’s not working.

      America, it’s people, customs, culture and unique exceptionalism prevail, and will always prevail.

      Report Post » GhostOfJefferson  
  • spreadcommonsensenot pc
    Posted on January 26, 2011 at 11:51am

    Progressivism——-Insanity running amuk

    Report Post »  
  • Lucent
    Posted on January 26, 2011 at 11:45am

    @ Temple

    Excellent Start. May I add to # 6, the EPA?

    Keep up the great thoughts Temple.

    Report Post »  
  • ENTITLEMENTSBLOW
    Posted on January 26, 2011 at 11:35am

    Hope and Change, Yes We Can (Spend Your Tax Dollars)!

    Report Post » ENTITLEMENTSBLOW  
  • jacobstroubles
    Posted on January 26, 2011 at 11:33am

    Yes of course it has.
    and I just sure, that further INVESTMENTS will help to reduce that..
    OK… everybody up off the floor now that you’ve all had a pretty good laugh.

    You just cant make this stuff up.

    Report Post »  
  • bifgroovey
    Posted on January 26, 2011 at 11:27am

    Dear CBO – Don’t confuse Democrats with facts.

    Everyone should remember – ENRON CEO was IMPRISONED for defrauding investors in the amont of $8 billion.

    Report Post » bifgroovey  
  • dizzyinthedark
    Posted on January 26, 2011 at 11:27am

    Yes, that’s right people, nothing to see here, move on or better yet, just sit down in the back and SHUT UP we’ll continue to do the driving!

    Report Post » dizzyinthedark  
  • kramh
    Posted on January 26, 2011 at 11:24am

    Last week I thought we might be able to balance the budget by cutting one trillion dollars, this week it is now one and a half trillion dollars, what will next week bring? When are the bond traders going to say enough? When will the taxpayers say no more and stop electing the spenders? Will we ever wake up and be willing to go through the economic pain coming from this insanity?

    Report Post »  
  • GhostOfJefferson
    Posted on January 26, 2011 at 11:24am

    Quite so. In fact, we don’t really have a currency except a fiat currency. It is, well, a fiction. But it’s a fiction we accept and use in daily life, so it persists. The bad thing however is that the fiction can be manipulated and expanded or retracted by the powers that be at will. Hence the huge inflationary/deflationary cycles and huge market cycle extremes we see, which would not happen in a commodity based free market. Deficits and debts like this would also be hard to accomplish, since you cannot “print” new gold and silver.

    Report Post » GhostOfJefferson  
    • cykonas
      Posted on January 26, 2011 at 6:21pm

      Ahh, the sweet soul honesty of Austrian Economics, Free Enterprise and the plain simple truth. Well said TJ, well said.

      Report Post » cykonas  
    • cykonas
      Posted on January 26, 2011 at 6:33pm

      Ahh, the sweet soul honesty of Austrian Economics, Free Enterprise and the plain simple truth. Well said TJ, well said.

      Report Post » cykonas  
  • CFHeather
    Posted on January 26, 2011 at 11:22am

    Soooo…. Deficit this year will be 1.5T and Obama wants to spend MORE?? Sorry Mr. President, I don’t think Bullet trains and “investment” (read SPENDING) are a priority

    Report Post » CFHeather  
  • Cemoto78
    Posted on January 26, 2011 at 11:16am

    The CBO “cooks” the books according to the numbers provided them by the politicians. I, for one, don’t know how anyone could work at the CBO knowing you have to use these phony numbers provided by crooks. It would make someone with morals feel very dirty.

    Report Post » Cemoto78  
    • rfycom
      Posted on January 26, 2011 at 2:12pm

      Yea kind of like working for a damn medical insurance company.

      Report Post »  
  • swonga
    Posted on January 26, 2011 at 11:10am

    Did anyone in the Tea Party believe Obama would propose to burn less money? NO! Come on it’s part of the Soros plan. Economic destruction of the republic.

    Report Post »  
  • suzy000
    Posted on January 26, 2011 at 11:03am

    I agree with the blogger here, “takingonissues.com”…how can we ever trust the CBO again? I think I will listen to Paul Ryan….he seems to be the only one who has it right!

    Report Post »  
  • Ilovetea
    Posted on January 26, 2011 at 11:02am

    Yesterday I was watching Fox News and during an interview (don‘t remember who it was with but it was on Neil Cavuto’s show) a Congressman/Senator was discussing a plan to trim 2.2 trillion from our budget. I had heard this before but was caught off guard when he fleeted by the statement, there is an additional 12 trillion dollars projected to be added to our deficit over the next 10 years. That leaves us now looking at 27 trillion dollars of outstanding bills 10 years from now. I am getting madder by the day and if things don’t change soon we are all looking at starting over.

    Is there a soul out there that can explain the sustainability of this?

    Report Post »  
    • GhostOfJefferson
      Posted on January 26, 2011 at 11:07am

      Wait until you discover what the actual real debt is. The numbers you list are minuscule compared to the actual real estimated debt. Think the words “sixty to one hundred twenty” and fill in the rest.

      Report Post » GhostOfJefferson  
    • Rickfromillinois
      Posted on January 26, 2011 at 11:38am

      I can explain the sustainability of this. Either the government will plant more money trees so that they can pick more money off it’s branches, will just print more money as long as they have ink and paper, or we will tax the rich for it since everyone knows that they stole it from the working poor and have tons of gold hidden in secret vaults in their basements and are just too greedy and selfish to share it with those who didn‘t win life’s lottery and were born rich.

      I didn’t say that it was a good or sensible explanation.

      Report Post » Rickfromillinois  
    • chuck
      Posted on January 26, 2011 at 1:05pm

      Our US debt is $14 trillion
      Our Total US debt is $55 trillion
      Our Total Unfunded Liabilities are $111 Trillion
      We add 77,000 to food stamps every 3 days
      We lose 2,600 jobs every 3 days

      Our GDP is $13.8 Trillion, our Debt to GDP is over 100% and we spend .43 cents on the dollar to service the debt.

      There is not enough money in the US, much less the world to pay this off. Bumpy ride ahead.

      Report Post »  
  • NickDeringer
    Posted on January 26, 2011 at 11:02am

    The Big Lie: Democrats are fiscally responsible.

    Yes the GOP spends money, but comparing the GOP to the Dems is like saying Martha Stewart is just as bad as Hitler.

    Report Post » NickDeringer  
  • Gonzo
    Posted on January 26, 2011 at 10:56am

    Insanity, unless your goal is for America as we know it to fail.

    Report Post » Gonzo  
    • Oh, God!
      Posted on January 26, 2011 at 11:02am

      I believe that is their goal.

      Report Post » Oh, God!  
    • Snowleopard {gallery of cat folks}
      Posted on January 26, 2011 at 12:32pm

      Yes, that is their goal:

      America to fail; to cause insanity, and to cause chaos.

      It will be up to us, the People of America, to decide what will emerge from the night, a new and great nation heading to her higher calling? Or a nation so divided and corrupted from the founders dreams that we will never emerge from the night again?

      Those are the choices WE need to make, and now.

      I for one will not let her pass into the night without doing my best to prevent it.

      Report Post » Snowleopard {gallery of cat folks}  
  • dwh320
    Posted on January 26, 2011 at 10:50am

    So did Obama lie again when he said all the spending would lower the debt? YEPPERS… OBAMA LIES !!!

    Report Post » dwh320  
  • dwh320
    Posted on January 26, 2011 at 10:48am

    Oops… not the numbers Progressives want the nation to know.

    Report Post » dwh320  
    • Cemoto78
      Posted on January 26, 2011 at 11:02am

      Another example of how the “progressive” ideas do not work. Obama was right last night, we do need to invest in this country and quit investing in all the other countries but ours. Quit giving money to the United nations as this is a totally corrupt organization. Quit trying to be the worlds policeman and bring our troops home to secure our borders from the illegal invasion. stop coddling those who have broken our laws by entering this country illegally and deport them. Bring back manufacturing by lowering the corporate taxes making America a favorable place to open and conduct business. Do away with the current income tax system in favor of a fair tax where everyone pays their fair share. And most of all, stop with the easy entitlement programs and make it more advantageous to work rather than sit around and collect a government check for doing nothing.

      Report Post » Cemoto78  
    • TexasCommonSense
      Posted on January 26, 2011 at 11:06am

      To sum it up, we’re going to accumulate more debt in one year than our country accumulated in its first 200 years of existence. The national debt in 1980 was $930.2 Billion. It’s truly sad when you think about it like this.

      Report Post » TexasCommonSense  
    • GdavidH
      Posted on January 26, 2011 at 11:16am

      Yaaaay!
      These progressives are the bestist. Breaking records left and right.

      Report Post » GdavidH  
    • Xcori8r
      Posted on January 26, 2011 at 11:18am

      Get the band together – break out the Champagne — Get up on deck and party!

      Pay no attention to that stupid iceberg.

      Report Post » Xcori8r  
    • Cobra Blue
      Posted on January 26, 2011 at 11:33am

      And the point is? Like we didn’t see the interest on the nations credit card ringing up faster than we can earn enough to pay IT. DAH! THIS IS NOT NEWS…….

      Report Post »  
    • Snowleopard the artist {gallery of cat folks}
      Posted on January 26, 2011 at 11:53am

      So now we get another perfect example of Congress and the President (past and present) spending out of control; the time for action is now, before we slam into the wall at full speed and the nation winds up defaulting upon its debt.

      The choice is simple, become fiscally responsible now with a little pain being caused; or major pain in the future.

      Report Post » Snowleopard {gallery of cat folks}  
    • gleestacy
      Posted on January 26, 2011 at 12:03pm

      Remember, when the CBO calculated the budghet forcast the factored in the so called Bush “Tax Cuts” I think this number might be a lttle off.

      Report Post »  
    • Rogue
      Posted on January 26, 2011 at 12:18pm

      I wouldn’t trust the CBO to give me an accurate number on what day of the month it is today. Same agency that claims repealing Obamacare would cost over $300 billion, and that if kept in place would reduce our deficit by a trillion.

      While this news is good for the right, I‘m guessing it’s far from accurate, and is probably far worse.
      Time to hit the reset button on the CBO – clear it out and either start over, or chain the door closed.

      Report Post » Rogue  
    • Cobra Blue
      Posted on January 26, 2011 at 12:25pm

      SnowLeopard

      You know what the outcome will be…major pain. No one wants to face the reality (NO…NO ONE WANT TO MAKE THE HARD CHOICE and do the right thing). So we will crash….the politicians wil then engage in major finger pointing, but by then it will be too late. Then change will begin. But until then the TALKing will continue and kicking the can down the road. It is inevitable. This is what history teaches us. And we know the only thing we don‘t learn from history is WE DON’T LEARN FROM HISTORY.

      Report Post »  
    • MOVETERAN
      Posted on January 26, 2011 at 12:29pm

      I wonder if it has to do with the 6 figure average salary that government employees are receiving?

      Report Post » MOVETERAN  
    • Snowleopard {gallery of cat folks}
      Posted on January 26, 2011 at 12:29pm

      @Cobra Blue

      Unfortunately you are dead on the money, history is a constant repeating of nations rising up, becoming strong, dominate, growing out of control and then disappearing into the dust of the ages. I hope this country may still be able to be the exception to that rule – we can always hope, and we need to keep the pressure on the dunderheads in the administration and congress to get this mess under control NOW.

      If it all comes down, they will, as you pointed out, point fingers and rant and rave like Fox Piven and the progressives do best; but it is WE the PEOPLE who will then have to deal with the mess, and they need to understand that to the core of their beings.

      Report Post » Snowleopard {gallery of cat folks}  
    • Rogue
      Posted on January 26, 2011 at 12:30pm

      @ Glee – your absolutely right – factoring tax money you “could have recieved” is not an accrued debt. It’s just a way to skew numbers in thier direction. I‘m surprised they didn’t come out and say “well, since we are not able to tax people at a rate of 85% of income, we will add to our deficit by 8 trillion this year.”

      Report Post » Rogue  
    • chuck
      Posted on January 26, 2011 at 12:51pm

      YAY, another new record deficit, and another new low for America, how low can one go? We’ll see…enjoy the ride, warning, we may encounter some turbulence! Buckle up.

      Report Post »  
    • EgoBrain
      Posted on January 26, 2011 at 1:05pm

      Doomed.

      Report Post » EgoBrain  
    • TexasCommonSense
      Posted on January 26, 2011 at 1:09pm

      M-O-O-N. That spells Doomed.

      Report Post » TexasCommonSense  
    • exdem
      Posted on January 26, 2011 at 1:14pm

      Wait until were done “investing” and giving welfare to all illegals. Obamao knows exactly what hes doing. Bankrupting the system. Collasping us economically. Following the Soros playbook. We the People must stop him and save ourselves. VOTE HIM OUT!!! and all his progressive croonies as well.

      Report Post »  
    • EgoBrain
      Posted on January 26, 2011 at 1:50pm

      @Texas~ I just saw that in a movie a few weeks ago. What movie was it?
      This will drive me Weinerish, until I remember the movie.

      Report Post » EgoBrain  
    • Secret Squirrel
      Posted on January 26, 2011 at 2:01pm

      The CBO only uses the numbers supplied by congress.
      If congress says “we’ll save $200 billion by making Amtrak more efficient”,
      that’s what is used. Nobody cares if it’s a lie. (except the taxpayer.)

      So, it is probably much worse!

      Report Post » Secret Squirrel  
    • natstew
      Posted on January 26, 2011 at 2:06pm

      Whose head will roll at the CBO over this.

      Report Post »  
    • Polwatcher
      Posted on January 26, 2011 at 2:32pm

      Rand Paul introduced a proposal to cut $500 Billion per year from the federal budget with out touching Social Security or Medicare. Why is it that all I hear is to cut Social Security when Social Security has $2.6 Trillion in treasury notes on hand. Social Security is not the problem right now.

      Report Post »  
    • portague
      Posted on January 26, 2011 at 2:47pm

      security notes are debt and not real money social securtiy admin counts it as money while the the rest of the government counts it as debt believe it or not securities are treated as debt. China owns a ton of securities and that is debt. Why they do not tell you the way it is is beyond me but securities are debt. So yes social security is a problem.

      Report Post »  
    • culp4cpa1
      Posted on January 26, 2011 at 11:18pm

      Am I the only one who sees the falacy of these numbers?
      The Federal government spent $4 trillion in 2010 which included almost $1 trillion in stimulus.
      If you eliminate the stimulus, you are down to $3 trillion.
      That means that the new budget at $3.5 trillion is up $500 billion.

      Report Post »  
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