U.S. Deficit Would Top $1 Trillion Under New Method

By: Associated Press Email
By: Associated Press Email

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A new government report says the federal deficit for 2008 would top $1 trillion if the government had used the same accounting methods as private companies.

And that doesn't even account for the huge costs of the Wall St. bailout, which didn't really start until the new budget year began on Oct. 1.

The new report also warns that the government is promising $49 trillion more than it can deliver on Social Security, Medicare and other benefit programs over the next 75 years unless the system is shored up.

The report found that under the accrual method of accounting used by businesses, which requires up-front payment of long-term costs like veterans benefits, the deficit for 2006 would have totaled $1 trillion not the $455 billion reported in October using cash accounting.

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