The federal budget deficit was about $1.2 trillion in the first ten months of fiscal year 2010, CBO estimates in its latest Monthly Budget Review—about $90 billion less than the roughly $1.3 trillion deficit incurred through July 2009.
By CBO’s estimate, spending during the first 10 months of the fiscal year was about $81 billion (or 2.7 percent) less than outlays at the same point in 2009. That decline includes a net reduction of close to $370 billion in major components of spending related to the recent financial crisis: the Troubled Asset Relief Program (down $277 billion), federal deposit insurance (down $50 billion), and Treasury payments to Fannie Mae and Freddie Mac (down $42 billion).
They continue:
In contrast, combined receipts from individual income and payroll taxes were about $58 billion (or 4 percent) lower than collections in the same 10-month period last year. Withheld income and payroll tax receipts fell by about $29 billion (or 2 percent), and nonwithheld receipts fell by about $37 billion (or 12 percent). In both instances, the declines occurred earlier in this fiscal year and are largely attributable to lower collections of tax liabilities incurred in 2009. Collections during the past three months were higher than those during the same months last year.
Thus things continue to look bleak. The collections are not there and that is reflective of weak jobs at the core as well as a weak business environment.
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