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Federal deficit up $200 billion compared to last year despite Biden's reduction claims
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New data from the nonpartisan Congressional Budget Office (CBO) shows the federal budget deficit has increased by $200 billion in fiscal year 2023 so far compared to a year ago, undercutting claims made by President Joe Biden about deficit reduction during his administration.
The CBO's monthly budget review was released Wednesday and noted that in the first four months of FY2023, which began on Oct. 1, 2022, the federal deficit was $459 billion – up by $200 billion compared to the $259 billion deficit reported in the same October-January period in FY2022. Federal revenue was $43 billion lower in the first four months of FY2023 compared to the prior year, primarily due to lower income tax receipts and fewer remittances of profits from the Federal Reserve banks as short-term interest rates have risen, while spending was up by $157 billion in the same period.
In Biden's State of the Union address Tuesday, he claimed, "In the last two years, my administration has cut the deficit by more than $1.7 trillion – the largest deficit reduction in American history." However, Biden's deficit reduction claims omitted the impact of expiring COVID-19 pandemic relief measures in achieving that reduction.
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