US budget deficit exceeds $1 trillion for fourth year

The US budget deficit for the fiscal year 2012 reached 1.1 trillion, above the 1-trillion mark for the fourth consecutive year, coinciding with president Barack Obama's tenure in the White House.

However, the fiscal condition is better than the last year. The budget deficit for the year ended September 2012 is 16 per cent lower at $207 billion compared with 2011, helped by a 6.4-per cent rise in tax revenue to more than $2.4 trillion. The largest gains came from payroll deductions and higher corporate tax collections.

Government spending for the year fell 1.7 per cent to $3.5 billion, partly on account of reduced defence spending and the withdrawal of the US troops from Iraq.

Obama's presidential rival Mitt Romney said that the president failed to fulfill his vow to cut down the deficit to half of what he inherited from his predecessor George Bush, by the end of his term.

In 2009, during the first year of Obama's presidency, the budget deficit reached a record $1.41 trillion overshooting forecasts by $210 billion.

Global economic recession, tax cuts and wars in Iraq and Afghanistan contributed to the record budget deficit. For the subsequent two years, the deficit was marginally lower as the economy started picking up and tax revenues increased.