US deficit ticks higher in fiscal 2011

The US budget deficit edged slightly higher in fiscal 2011 but shrank in terms of its size relative to the economy's output, the Treasury Department said Friday. The shortfall rose 0.4 percent in the year ended September 30 from a year ago, to $1.299 trillion, the department said in releasing the details of the fiscal 2011 budget results. That marked the second-highest gap in US history after the record $1.416 trillion hit in 2009 when the government poured cash into the recession-wracked economy. As a percentage of gross domestic product, the budget picture improved. The deficit was 8.7 percent of GDP in the 2011 fiscal year, down from 9.0 percent in fiscal 2010. "The FY 2011 deficit remained elevated as a result of the continued effects of the financial crisis in 2008 and 2009, which have put a persistent strain on federal revenues and outlays," the Treasury and the White House said in a joint statement. "The slight uptick in the nominal deficit from last year was due to higher outlays that were nearly offset by higher receipts," they said. The federal government's receipts rose 6.5 percent from fiscal 2010, to $2.302 trillion. The increase brought receipts to 15.4 percent of GDP, compared with 15.1 percent the prior year. Outlays rose 4.2 percent from a year ago, to $3.601 trillion, and were unchanged from the prior year at 24.1 percent of GDP.