U.S. Treasury Secretary Tim Geithner and White House Office of Management and Budget (OMB) Director Peter R. Orszag today released details of the final Fiscal Year 2009 budget results. In making the announcement, Geithner and Orszag pointed to the severe economic and financial crisis the country faced this year and the Administration's commitment to lay a new foundation for economic growth and fiscal sustainability.
"This year's deficit is lower than we had projected earlier this year, in part because we are managing to repair the financial system at a lower cost to taxpayers. But future deficits are too high, and the President is committed to working with Congress to bring them down to a sustainable level as the economy recovers," Secretary Geithner explained.
"It was critical that we acted to bring the economy back from the brink earlier this year. As we move from rescue to recovery, the President recognizes that we need to put the nation back on a fiscally sustainable path. As part of the FY 2011 budget policy process, we are considering proposals to put our country back on firm fiscal footing," Director Orszag stated.
A summary of the FY2009 data, released as part of the September 2009 Monthly Treasury Statement of Receipts and Outlays of the United States Government, shows that the federal deficit dropped by $162 billion from a projected $1,580 billion in the August Mid-Session Review (MSR) to the final figure of $1,417 billion.
Receipts for the fiscal year totaled $2,105 billion, while outlays totaled $3,522 billion.
The decline in the deficit from the August MSR estimate reflected outlays that were $132 billion lower than expected in August, in large measure because of lower-than-anticipated outlays by the government's Troubled Assets Relief Program (TARP). The decline was also the result of receipts that were $31 billion higher than estimated in the MSR.
The FY2009 deficit was largely the product of the spending and tax policies inherited from the previous Administration, exacerbated by a severe recession and financial crisis that were underway as the current Administration took office. The new Administration's chief economic stabilization and recovery efforts implemented through TARP and the American Recovery and Reinvestment Act (Recovery Act) accounted for 24 percent of the deficit total.
Federal borrowing from the public net of financial assets increased by $1,417 billion during FY2009, to $6,711 billion or 47.2 percent of GDP.