(WASHINGTON) — Due to a stronger economy, less spending and a higher tax rate for the rich, the White House’s Office of Management and Budget predicted on Monday that the annual budget deficit will shrink to $759 billion by Sept. 30, the end of fiscal 2013.
Three months ago, the administration estimated a deficit $200 billion higher than the new projection. If things continue at the current pace, the Congressional Budget Office has suggested the shortfall could drop to as low as $642 billion.
This certainly is better news for President Obama, considering the government has run a deficit of more than $1 trillion every year since he’s taken office.
Of course, the sequester — those deep automatic spending cuts that kicked in during the spring — is making life more difficult, according to the White House.
Without the across-the board spending reductions, total economic growth for the year would be 2.6 percent, according to administration analysts. If the cuts persist, however, growth will be closer to 2.4 percent.
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