Growing Federal Deficit Alarms Some

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Growing Federal Deficit Alarms Some

By Molly Henneberg

FOXNews.com

Wednesday, July 15, 2009

The Obama administration's projected deficit for this fiscal year that ends September 30 has hit a jaw-dropping $1.84 trillion dollars.

That's enough to buy 397 billion gallons of regular gasoline, 48 gallons of milk for each of the 7 billion on the planet or 45 million brand new 2010 Ford Mustangs.

Economists warn the deficit is becoming a larger part of the total U.S. economy or gross domestic product.

"The last time we had a really large deficit was in the early '80s, when it was about 5 percent of the GDP," said economist Alex Brill of the American Enterprise Institute. "Now it's 13 percent of GDP."

Brill says that can lead to inflation, higher interest rates and higher taxes to pay it back.

Last year, the deficit was $454.8 billion, then the largest in history. Economists say that was because of the recession and two wars. Now the deficit is expected to quadruple in one year due in large part to the financial meltdown, the $700 billion bank Wall Street bailout and the $787 billion dollar stimulus package.

In February, President Obama promised to make a dent in the deficit.

"I am pledging to cut the deficit we inherited by half by the end of my first term in office," he said.

But Republicans say he just can't do that and still push through big-spending items like health care reform.

"It's absurd they're not going to cut the deficit in half," said Sen. Judd Gregg, R-N.H., "They're going to grow the deficit."

Brill says it would cost every American $6,000 dollars just to pay off this year's deficit. And that's on top of the $13 trillion dollars we call the national debt.