The federal government ran a bigger deficit in January, pushing the imbalance so far this budget year up 6.2 percent from the same period a year ago.
The Treasury Department said Wednesday the deficit for January stood at $17.5 billion compared to $10.3 billion a year ago. For the first four months of the budget year that began in October, the deficit widened to $194.2 billion, from $182.8 billion during the same period last year.
The budget deficit has gradually narrowed since 2012, which was the fourth straight year in which it topped the $1 trillion mark. The improvement reflects the country’s economic recovery from recession. The government is seeing higher tax revenues as people go back to work and smaller payments for safety-net programs such as unemployment assistance. It also represents efforts by Congress to control deficits through higher taxes and across-the-board spending cuts.
Last year’s deficit benefited from a $24 billion special payment Freddie Mac made for the support it received during the financial crisis. The Congressional Budget Office forecasts a deficit of $468 billion for the full 2015 budget year, 3.1 percent lower than in 2014.
For the current budget year, government revenues total $1.05 trillion, an increase of 8.7 percent from the same period a year ago. Government spending totals $1.24 trillion, up 8.3 percent over last year.
The deficit in 2014 narrowed to $483.3 billion from $680.2 billion in 2013. Before that, the deficits soared to record heights as the government grappled with revenue losses from the Great Recession and increased spending in such areas as unemployment benefits and food stamps.
President Barack Obama unveiled last week his new budget proposal, which projects the 2015 deficit to rise to $583 billion, sharply higher than the CBO’s latest estimate. Obama’s new budget is asking Congress for authorization to spend $4 trillion next year and projects a 2016 deficit of $474 billion.
The president’s budget proposal will set off months of wrangling in Congress. Obama proposed increasing taxes on the wealthy and using the extra income to support increased funding to rebuild America’s aging roads and bridges, provide two years of free community college to qualified students and trim future deficits to what the administration said would be manageable levels.
But Republicans immediately attacked the proposal for raising taxes and failing to tackle rising spending on government benefit programs such as Social Security and Medicare. GOP lawmakers said the budgets they put together in coming weeks will eliminate deficits over the next decade.
The CBO is forecasting that without any changes in government policies, the deficit will decline slightly to $467 billion in 2016 but then will start rising and top $1 trillion again in 2025 as spending balloons for Social Security and Medicare.