Originally created 01/16/04

Deficit is $128.7 billion for first three months of the budget year



WASHINGTON -- The government produced a deficit of $128.7 billion for the first three months of the 2004 budget year, which was $20 billion more than for the same period a year earlier, the Treasury Department reported Thursday.

For the budget year that began Oct. 1, spending totaled $569.4 billion, compared with $535.6 billion for the same period last year. Revenues came to almost $440.8 billion, compared with $427.3 billion.

The year-to-date deficit of $128.7 billion was about 19 percent more than the shortfall of $108.2 billion produced in the first three months of the 2003 budget year.

So far this budget year, the biggest spending categories were Medicare and Medicaid, $135.4 billion; Social Security, $131.1 billion; interest on the public debt, $115 billion; and military, $107.7 billion.

On the revenue side, individual income tax payments came to $198.7 billion in the first three months of the 2004 budget year, compared with $197.7 billion for the same period a year ago. Corporate income tax payments totaled $43.2 billion so far this year, compared with nearly $33 billion last year.

In December, the government recorded a deficit of $16.2 billion, a reversal from the same month last year, when a $5 billion surplus was produced. December's deficit was based on revenues of $186.7 billion and spending of $202.9 billion.

The White House's budget chief has said the red ink could top $500 billion in the current budget year, even as the economy strengthens.

The Bush administration has blamed the deficits on the costs of the war in Iraq, fighting terrorism and a lackluster economy. Democrats say a major cause has been President Bush's tax cuts and they also point to what they contend are bad economic policies.

For the 2003 budget year, which ended Sept. 30, the government produced a deficit of $374.2 billion. That was a record in dollar terms, surpassing the previous $290 billion record set in 1992.

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