U.S. on pace for $1 trillion deficit

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The federal government set a new monthly record deficit of $232 billion in February and has notched a total of $581 billion in the first five months of the fiscal year, according to the Treasury Department’s official count released Monday.

February’s record is $8 billion more than the previous monthly record, set in February 2011, and came chiefly because of a drop in individual income tax receipts.

The overall deficit remains on pace to top $1 trillion this year for the fourth year in a row — but is down slightly from its pace last year, chiefly because of higher corporate tax receipts and estate and gift taxes, which topped $5 billion. At this point in fiscal 2011, just $54 million had been collected in gift and estate taxes.

On the other side of the ledger, spending was down from $1.51 trillion to $1.47 trillion. Low interest rates continue to help the government’s fiscal picture, but last year’s spending cuts also appear to be taking effect, with slight drops in nearly every major category of spending.

Lower unemployment benefits also cut about $12 billion from Labor Department spending, according to the figures.

Treasury statistics are the official determination of the government’s finances. Monday’s figure is slightly worse than the nonpartisan Congressional Budget Office projected in its preliminary estimate last week.

Despite having a higher debt, the government has paid only $186 billion in interest so far this year, down from $191 billion in the first five months of fiscal 2011.

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