Budget deficit tops $1 trillion for fourth time

With three weeks still to go in the fiscal year, the federal government already has notched its fourth straight trillion-dollar deficit, the Congressional Budget Office said Monday.

CBO, which releases estimates each month, said the government ran a $192 billion deficit in August, putting the federal government $1.17 trillion in arrears for fiscal 2012, which ends Sept. 30.

The $192 billion deficit was the worst August on record, though the total deficit so far this year is actually lower than it was in 2011, when it stood at $1.23 trillion after 11 months.

CBO said rising wages have brought more tax revenue into the government this year, while new spending has risen at a slightly lower pace, which explains the declining deficit. Spending on Medicaid and unemployment benefits both dropped as heightened stimulus spending ended, and lower costs for the wars in Afghanistan and Iraq also have meant less spending on defense.

But Social Security is up 6 percent and Medicare spending is up 4 percent compared with 2011, CBO said.

The deficit is down significantly from 2009’s record $1.4 trillion.

But CBO in a report last month predicted the government will flirt with yet another trillion-dollar shortfall next year.

Republican presidential nominee Mitt Romney’s campaign laid blame for the deficit at the feet of President Obama.

“Under the president’s reckless spending policies, we’ve seen the financial burden on future generations grow, while the White House has ducked hard decisions on reining in our mounting debt and deficits,” campaign spokesman Ryan Williams said.

The deficit figures come as a new book by journalist Bob Woodward looks at the back-and-forth during last year’s debt fight, which produced an agreement that was supposed to cap spending and try to get a handle on deficits.

In exchange for spending caps, congressional Republicans agreed to raise the government’s debt ceiling, staving off a fiscal crisis where the government would have had to shut down about 40 percent of its spending.

According to accounts, Mr. Woodward’s reporting suggests Mr. Obama failed to show leadership in trying to get a broader deal done.

But White House press secretary Jay Carney said Mr. Obama met with congressional leaders often and tried to push for an agreement that matched his own principles.

“What we experienced and what we continue to experience is the adamant refusal of Republicans, led by House Republicans, to accept that millionaires and billionaires ought to be part of the deal,” Mr. Carney said. “In order to protect the middle class from having their taxes going up, to protect seniors from having to live in a world where Medicare comes in a voucher and their costs skyrocket, millionaires and billionaires need to pay a little bit more.”