WASHINGTON (AP) — The U.S. government started the first month of the 2014 budget year with a $91.6 billion deficit, signaling further improvement in the nation’s finances at a time when lawmakers are wrestling to reach a deal that would keep the government open past January.
The Treasury Department said Wednesday that the deficit in October fell 24 percent compared with the $120 billion imbalance recorded in October 2012. The deficit is the gap between the government’s tax revenue and spending.
Across-the-board spending cuts and the partial government shutdown helped lowered expenditures in the first month of the new budget year. Higher taxes and an improved economy also boosted revenue.
The October decline comes after the government ran an annual deficit in 2013 of $680 billion, the lowest in five years and the first in that period below $1 trillion. Shrinking deficits could take some pressures off of lawmakers, who are facing a Dec. 13 deal to fund the government and avoid another shutdown.
Even with the decline, last year’s annual deficit was the fifth-largest in history and added to the nation’s record $16.7 trillion debt.
An improved economy has put more people back to work and boosted corporate profits. And Social Security taxes rose at the beginning of the year, along with income tax rates on wealthier Americans. Tax revenue rose 8 percent in October compared with a year earlier to $199 billion.
Spending fell 5 percent in October to $290.5 billion, mostly because of the across the board cuts that took effect in March. Spending delayed by the shutdown could occur in November, pushing up the deficit next month. But some of that delayed spending, as well as back pay for furloughed federal workers, likely occurred in October after the shutdown ended Oct. 16.
So far, the improving budget picture hasn’t made it easier for Congress and the White House to reach a longer-term agreement on taxes and spending. A fight over the budget and President Obama‘s health care program led to the 16-day shutdown. The battle ended with only a temporary agreement to re-open the government until Jan. 15. And the borrowing limit was extended to just Feb. 7.
Congressional leaders also agreed to set up a House-Senate conference committee that is seeking a budget deal to avoid another shutdown next year. That committee held a public hearing Wednesday that made little apparent progress. It mostly consisted of speeches by members of Congress and testimony by Douglas Elmendorf, director of the Congressional Budget Office.
A top priority for many lawmakers is to replace the automatic spending cuts scheduled for 2014, which are expected to have a greater impact on the budget. Many agencies used spare cash last year to offset some of the cuts. That’s unlikely to be an option this year.
Private talks between House Budget Committee Chairman Paul Ryan, R-Wis., and his Senate counterpart, Patty Murray, D-Wash., are focused on replacing the across the board cuts with other spending reductions and special interest tax breaks.
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This Week’s Celebrity Instagrams (6/18-6/24)
25 photos Launch gallery
1. Me & the homie @jaleelwhite #RujohnFoundation Happy to be in Jamaica! Good times
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5. Good Morning. Early day in Detroit! Making press rounds for @thebossnetwork's Ladies That Lead Tour. Thank you @traycemadre and @colourbynumbr for my glam.
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6. POWER the best show on TV @djenvy, Queens we so big out here. #EFFENVODKA #FRIGO
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7. They said u lost a step, wasn't explosive as once was, the best days was in the real view, questioned your drive, your leadership, your commitment, you don't have killer instinct, going back home is the worst mistake in your career, he got the coach fired, players traded, won't work between him and Kyrie, Him and Kev won't work, love your teammates to much, there's no way he can deliver a championship in his hometown, etc etc etc.... But guess what THATS NONE OF MY BUSINESS #StriveForGreatness #ThisOneIsForTheLand #PutSomeRespeckOnMyName Hahahaha!!! Yes sir
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8. Oooooh weeee this man right here is responsible for at least three of our four babies!! #JOE ❤❤❤🎤 #rnb #king #voicelikebutter #ForPeetesSake
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9. Hanging with my @abcnetwork family! @abcunclebuck tonite y'all check us out ! @anthonyanderson @traceeellisross
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10. My broski ( @sayeedshahidi ) and I are on Top 5 Live on @go90 at 5 (which is super duper close)! Make sure to tune in :) #UncleBuck #Blackish
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11. Lights out💤 #GoodNight
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12. Late nights mornings
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13. Ran into the lovely talented @siedahgarrett on this brutiful favvuz deh!
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14. #halal #love #thedargans #kattwilliamsSHOW #mashallah when that Jennah piece HIT!! @sweetjennahcollection glasses by @baddieglamaccessories LIZ 😍 @dynamiteko top @dazzledmv and jeans @thevision414 and shoes: @louboutinworld
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15. Big Hair and Optical Illusions #OceanDrive #MiamiLiving #coverparty
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16. MAMA and THE SAVAGES ... ⚓️ #supportyourlocalgirlgang
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17. From the bottom of my ❤️, thank you new followers & old! & hello fellow night owls! #grateful #racheltrue #naturalhair #curlyhair #curlygirl #healthyhair
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18. I feel so grateful because I met these amazing young minds, visiting from Houston TX, during their college tour stop today at #usc.These students are ALL extraordinary and embody academic excellence so I'm humbled to have shared a few moments with them to applaud and celebrate their bright futures ahead! Thank you @EmergeFellows for inviting me to speak and blessing me with your love and attention this afternoon!
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19. Happy Fathers Day Pops. U taught me how to be a man. Lessons of love, hard work & gratefulness. Sorry the fishing didn't stick. LOL. I Love U!
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20. Sky Zone and Ice Cream! Best Fathers Day Ever!! Photo credit @mariahcarey
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21. Look what finally came in the mail 😎 #mtvmovieawards2016 💥+🌽! #straightouttacompton
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22. Claudia Jordan: ....
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23. 'Member that time I almost knocked a bajillion dollar camera off the car? Really? Yeah, me neither! #Greenleaf Episode 2 comin atcha!
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24. Full of love. #birthday #Cabo
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25. Oh hey! Look who just joined Snapchat
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