CBO projects U.S. budget deficit to reach $1.5 trillion in 2011, highest ever

The grim forecast from the nonpartisan Congressional Budget Office came hours after President Obama called in his State of the Union address for Republicans and Democrats to work together to rein in record deficits that are pushing the national debt into uncharted territory. At $1.5 trillion, the deficit would equal 9.8 percent of the economy, the CBO said, making it one of the largest by that measure since the end of World War II.

Conrad said the new deficit numbers released Wednesday in the CBO's twice-yearly budget outlook served "as another wake-up call" and added to the urgency around the group's work. After two years of record deficits hovering around $1.4 trillion, policymakers had hoped that an improving economy would begin to narrow the gap between spending and revenues.

Instead, the CBO forecast that the budget gap is widening again and is on track to remain above $1 trillion in 2012, the fourth year in a row.

Read the full article at: CBO projects U.S. budget deficit to reach $1.5 trillion in 2011, highest ever