President Obama is slashing his spending ways. The federal deficit for the just-finished 2010 budget year was under $1.3 trillion, claims the CBO. That means the CBO has the deficit about $125 billion below the $1.42 trillion record posted for 2009. How did he do it you might ask, fiscal responsibility, saying no to pork, cutting union no show jobs, it would be a negative on all accounts. The decline in the deficit from last year’s record is due to $108 billion in repayments and other revenues from TARP the Troubled Assets Relief Program, the bailout of the financial services sector in 2008. For all those people that say there head spins when we talk about numbers or the facts this new number means the government borrowed 37 cents out of every dollar it spent. We know the tax revenues continued to decline and we are spending more on food stamps and unemployment benefits due to the recession not ending as it was supposed to. This does set up drama over Social Security tax revenues as income tax revenues are down 1.6 percent and payroll taxes are down 3.2 percent. Unemployment benefits have jumped 34 percent as the jobless rate stayed near ten percent nationwide and Congress renewed benefits for the long-term unemployed. The 2010 deficit equaled almost nine percent of the size of the economy, far more than the three percent or so that economists say is sustainable. This is new air and we are never going back, deficits of $1 trillion in a single year never happened until President Obama as the $1.4 trillion deficit in 2009 was more than three times the size of the previous record-holder that was President George Bush last year with a $454.8 billion deficit in 2008.
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