The U.S. budget deficit will shrink by the end of fiscal 2013 to $642 billion, the smallest shortfall in five years, according to the nonpartisan Congressional Budget Office.This is good news.
The agency yesterday reduced its estimate of the likely shortfall by more than $200 billion compared with its February projections. The agency cited stronger-than-expected tax receipts as well as payments to the Treasury by government-owned Fannie Mae and Freddie Mac as major reasons for the change.
The decline from last year’s $1.1 trillion deficit would mark the first time since 2008 that the gap between taxes and spending slipped to under $1 trillion. It would also postpone the effective deadline for raising the government’s debt ceiling to avoid default until as late as November, the agency said.
Wednesday, May 15, 2013
The Incredible Shrinking Deficit
A Calculated Risk post on the budget deficit shrinking to its lowest level since 2008, before the recession and credit crisis. Here is a Bloomberg article on the same topic. The following are the first three paragraphs from the Bloomberg article: