Reflecting revival of the U.S. economy, the country’s budget deficit has dropped by USD 72 billion in 2014 than the previous year, according to a report.
Capped off by a USD 2 billion surplus in December, the government ended the calendar year with a deficit of USD 488 billion, USD 72 billion less than the 2013 tally, The Wall Street Journal reported.
The federal government uses a fiscal year that begins in October; on that basis, the 2014 fiscal year ended in September saw a deficit of USD 483 billion, the lowest of Barack Obama’s presidency, it said.
In 2014, the U.S. racked up its smallest budget deficit since 2007, marking an economic shift of fortunes, it added.
“The improvements in the short-term deficit are positive, and importantly, reflect the improving economy,” Maya MacGuineas, the president of the Committee for a Responsible Federal Budget, told the Journal .
According to the daily, though still large in absolute terms, government spending and deficits have both decreased dramatically since 2010 as a share of the nation’s economy.
The deficit in 2014 was just under three per cent of GDP, using the most recently available figures for the size of the economy. That’s below the average since the 1980s, it said.
The hysteria and crisis that surrounded the discussion in 2010 and 2011 have thankfully dissipated, said Joel Friedman, the vice-president for fiscal policy at the Center for Budget and Policy Priorities.
