The U.S. government’s budget deficit totaled $58.7 billion in March, adding to the
shortfall created so far in fiscal 2003 amid a weak economy and
increased defense spending.
The U.S. Treasury said the deficit compared with $64.8
billion in March 2002 and $50.7 billion in March 2001. The
government typically records deficits during the month because it
mails out tax refunds.
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President George W. Bush has estimated a record annual
shortfall of more than $300 billion this fiscal year, not counting
war costs. The deficit may be even larger once the costs of war
and defense measures are included.
“The Treasury is hemorrhaging red ink, largely because a
weak economy and slumping equity markets have depressed revenues
while waging the wars on terrorism and Iraq have boosted
outlays,” said Steven Wood, principal economist at Insight
Economics in Walnut Creek, California.
Economists had expected a deficit of $55 billion, based on
the media forecast of 39 economists in a Bloomberg News survey.
For the first six months of this fiscal year, which started
Oct. 1, the Treasury reported a deficit of $252.6 billion,
compared with a shortfall of $131.9 billion during the first six
months of fiscal 2002. After four years of surpluses, the U.S.
posted a deficit of $157.8 billion for fiscal 2002. The highest
annual deficit ever was $290.4 billion in 1992.
Revenue in March rose to $120.4 billion, up 8.2 percent from
a year earlier, and spending was $179.1 billion, 2.1 percent
higher than March 2002, according to the Treasury.
The U.S. economy has lost 2 million jobs since March 2001,
start of a recession that some economists say ended later that
year. The National Bureau of Economic Research, the private group
of economists that dates business cycles, has yet to declare that
recession over.
With the nation heading toward a record deficit this year,
Bush this week signaled that he has accepted Congress’s 25 percent
reduction in his 10-year tax cut proposal. The president sought a
package of as much as $726 billion in tax relief.
“We need tax relief totaling at least $550 billion to make
sure our economy grows,” he told small business leaders in the
White House Rose Garden last week. Bush on Wednesday signed a
supplemental spending measure that provides $79 billion to pay for
the Iraq war, bolster domestic security and aid U.S. airlines.
Bloomberg News
