Obama inherited an economy in recession and a deficit in excess of $1 trillion. He promised to cut the deficit in half by the end of his first term, but deficits have instead remained at eye-popping levels, including a record $1.4 trillion deficit in 2009 and deficits of $1.3 trillion in each of the past two years.
In Wednesday night's debate, Obama said he has a budget plan to shave $4 trillion from the deficit over the coming decade, but he counts $1 trillion from savings already accomplished in budget deals with Republicans last year and $848 billion from winding down wars in Iraq and Afghanistan.
Republican presidential nominee Mitt Romney promises to balance the budget within eight to 10 years, but hasn't illustrated how he would do so. His budget claims are suspect as well since he promises to cut the overall budget by about $500 billion in 2016 alone, while also promising to sharply boost military spending and restore more than $700 billion in Democratic cuts to Medicare over the coming decade. Romney has ruled out increasing taxes.
Congress is looking toward addressing the deficit at the end of the year, but any such effort would actually increase the deficit since lawmakers promise to restore most or all of Bush-era tax cuts that are set to expire Dec. 31. Lawmakers also want to head off $109 billion worth of automatic spending cuts set to hit the Pentagon and domestic programs in January. Republicans and Democrats disagree on whether part of the effort to replace this so-called sequester should include tax increases on upper-income earners.