Record U.S. Deficit: $490 Billion

ANDREW TAYLOR
Associated Press
July 28, 2008

WASHINGTON (AP) — A Bush administration official said Monday the next administration will inherit a record federal budget deficit for next year that approaches $490 billion.

The official said the deficit was being driven to record levels by the sagging economy and the stimulus payments being made to 130 million households in an effort to keep the country from falling into a deep recession. A deficit approaching $490 billion would easily surpass the record deficit of $413 billion set in 2004.

The administration official spoke on condition of anonymity because the new estimate had not been formally released. Administration officials were scheduled to do that at a news conference later Monday.

White House press secretary Dana Perino had no comment on the $490 billion figure. But she told reporters that the White House and lawmakers acknowledged months ago that they were going to increase the deficit by approving a short-term boost for the slumping economy.

“Both parties recognized that the deficit would increase, and that that was going to be the price that we pay,” Perino said.

The White House had predicted next year’s deficit at $407 billion. Figures for the 2008 budget year ending Sept. 30 may also set a record.

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