According to new Congressional Budget Office figures, the U.S. federal budget deficit will hit an unprecedented $1.2 trillion for the 2009 budget year.  The CBO also projects a $703 billion deficit for 2010.  The dismal figures come a day after President-elect Barack Obama warned of “trillion-dollar deficits for years to come.”

To make matters worse, the CBO figures don’t account for the massive economic stimulus bill that Obama is proposing, nor does it include the cost of the trillion-dollar Wall Street bailout.

The massive deficit is the result of a sharp drop in tax revenues and the $350 billion spent so far for the Wall Street bailout.

The $1.19 trillion figure for 2009 shatters the previous record of $455 billion, set just last year.  This massive debt represents about 8 percent of the economy, which is higher than deficits from the free-spending 1980s.

Economy experts warn that our large and sustained budget deficits will continue to put upward pressure on interest rates and result in even more debt.  This news surely dashes any hope that the incoming Democratic-controlled Congress would do a better job of managing our country’s finances.  It’s clear now that none of our Congressional leaders from either party are capable of fiscal responsibility.

To remind us of this crushing financial weight on the shoulders of our children, we’ve added a national debt clock below and in the sidebar at left.

More bad news at FoxNews

This entry was posted on Wednesday, January 7th, 2009 at 2:51 pm and is filed under Finance, Problems. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.