Surpluses and Deficits

When President Clinton was first elected in 1992, the federal budget was in a deficit.  During the 1990's, as a result a strong economy, the government brought in much higher revenues than expected and began, by the end of the decade, to run a budget surplus.  In 2002, as a result of September 11, increased military spending and anti-terrorism spending, tax cuts, and the downturn in the economy, the federal budget went back into deficit.  In October 2009, the Congressional Budget Office (CBO) estimated a deficit for FY 2009 of $1.4 trillion—a figure that includes the cost of the cost of TARP and stimulus spending for the fiscal year.  See Chart 4 (the dollars represent billions of dollars).