US records $130 billion budget deficit in May

Published on NewsOK Modified: June 11, 2014 at 1:49 pm •  Published: June 11, 2014
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Over the next decade, CBO is projecting that deficits will total $7.6 trillion, $286 billion less than it projected in February. The biggest factor in the improvement is $165 billion less in projected spending on health insurance subsidies for policies sold through exchanges created by the Affordable Care Act. Those policies are proving less costly than CBO originally thought, mainly because of tighter management of treatment options.

The CBO is forecasting that the deficit will fall to $469 billion in 2015 before rising again and topping $1 trillion annually starting in 2023. The increases will be driven by spending on the government's major benefit programs, including Social Security and Medicare, as baby boomers retire.

Republicans have accused Obama of failing to propose significant cost-cutting measures to reduce soaring entitlement costs. Democrats counter that Republicans would rather impose sharp cuts on needed government programs than impose higher taxes on the wealthy.

Neither side is expected to make major concessions in this congressional election year. But the budget wars of the past three years have subsided at least for a brief time. An agreement was reached in December on the broad outlines for spending over the next two years. The agreement will allow Washington to avoid the gridlock that culminated in October's 16-day partial shutdown of the government.

The budget cease-fire also includes legislation that will suspend the government's borrowing limit through March 15 of next year. That puts off another battle over raising the debt ceiling until a new Congress takes office in January.



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