Deficit nears record under latest estimates

WASHINGTON (AP) -- The latest estimates show the U.S. federal deficit running to a near-record level for the budget year ending September 30th.

Today's Capitol Hill figures now clock the deficit at 407 billion dollars. And the Congressional Budget Office predicts the red ink will spill over into next year. That's when the deficit could reach a record 438 billion dollars -- and likely higher as the government takes over mortgage giants Fannie Mae and Freddie Mac.

The numbers represent about 3 percent of the size of the economy. They're still much smaller than the deficits of the 1980s and early 1990s. But the new figures are so eye-popping in dollar terms that they may keep the next president from adding to it with extra spending programs or tax cuts.

(Copyright 2008 by The Associated Press. All Rights Reserved.)

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